THE POST-GRADUATE STUDENTS SOCIETY OF McGILL UNIVERSITY INC. / L ASSOCIATION DES ÉTUDIANTS POST-GRADUÉS DE L UNIVERSITÉ McGILL INC.

Size: px

Start display at page:

Download "THE POST-GRADUATE STUDENTS SOCIETY OF McGILL UNIVERSITY INC. / L ASSOCIATION DES ÉTUDIANTS POST-GRADUÉS DE L UNIVERSITÉ McGILL INC."

Ellen Weaver
5 years ago
Views:

1 Financial statements of THE POST-GRADUATE STUDENTS SOCIETY OF McGILL L ASSOCIATION DES ÉTUDIANTS POST-GRADUÉS DE L UNIVERSITÉ McGILL INC. May 31, 2013

2 UNIVERSITY INC. Table of contents Independent auditor s report Statement of operations... 3 Statement of financial position... 4 Statement of changes in net assets... 5 Statement of cash flows... 6 Notes to the financial statements

3 Deloitte s.e.n.c.r.l. 1 Place Ville Marie Suite 3000 Montreal QC H3B 4T9 Canada Tel: Fax: Independent auditor s report To The Post-Graduate Students Society of McGill University Inc. / L Association des étudiants post-gradués de l Université McGill Inc. We have audited the accompanying financial statements of The Post-Graduate Students Society of McGill University Inc. / L Association des étudiants post-gradués de l Université McGill Inc., which comprise the statement of financial position as at May 31, 2013, and the statements of operations, changes in net assets and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian accounting standards for not-for-profit organizations, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

4 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of The Post-Graduate Students Society of McGill University Inc. / L Association des étudiants post-gradués de l Université McGill Inc. as at May 31, 2013, and the results of its operations and its cash flows for the year then ended, in accordance with Canadian accounting standards for not-for-profit organizations. Comparative information Without modifying our opinion, we draw attention to Note 2 to the financial statements, which describes that The Post-Graduated Students Society of McGill University Inc. / L Association des étudiants post-gradués de l Université McGill Inc. adopted Canadian accounting standards for not-for-profit organizations on June 1, 2012, with a transition date of June 1, These standards were applied retrospectively by management to the comparative information in these financial statements, including the statements of financial position as at May 31, 2012, and June 1, 2011, and the statements of operations, changes in net assets, and cash flows for the year ended December 31, 2011, and related disclosures. We were not engaged to report on the restated comparative information, and as such, it is unaudited. DATE 1 CPA auditor, CA, public accountancy permit No. A133206

5 THE POST-GRADUATE STUDENTS SOCIETY OF MCGILL Statement of operations year ended May 31, 2013 Unrestricted fund Restricted fund Total $ $ $ $ $ $ (unaudited) (unaudited) (unaudited) Revenue Fees 576, ,165 2,596,395 2,725,698 3,172,924 3,338,863 Services 109, , , ,953 Sales 925, , , ,579 Investments 17,513 17,699 4,412 3,089 21,925 20,788 Other 67,599 2, ,599 2,312 1,697,149 1,738,708 2,600,807 2,728,787 4,297,956 4,467,495 Expenses Cost of goods sold 365, , , ,110 Stipends 96,805 90, ,805 90,756 Executive and committee activities 9,605 9, ,605 9,805 Advocacy and outreach 13,753 17,067 41,250 38,296 55,003 55,363 Governance 15,956 24, ,956 24,780 Services 107, ,077 33,262 16, , ,077 Salaries and benefits 644, ,072 12,967 42, , ,020 Contractual obligations 4,040 14,000 2,323,850 2,510,499 2,327,890 2,524,499 Operational costs 21,608 18, ,608 18,016 Operational consumables 10,700 5, ,700 5,983 Corporate management 37,949 22,215 2,036 2,941 39,985 25,156 Administrative 302, ,020 2,618 9, , ,243 Special project (150) 131,317 95,181-95, ,317 Amortization 58,761 29, ,761 29,684 Amortization service agreement 11, ,398-1,701,433 1,665,902 2,511,164 2,619,907 4,212,597 4,285,809 Excess of revenue over expenses for the year (4,284) 72,806 89, ,880 85, ,686 The accompanying notes to the financial statements are an integral part of this financial statement. Page 3 of 12

6 THE POST-GRADUATE STUDENTS SOCIETY OF MCGILL UNIVERSITY INC. Statement of financial position as at May 31, 2013 May 31, May 31, June 1, $ $ $ (unaudited) (unaudited) Assets Current assets Cash 894, , ,921 Short-term investments (Note 9) 587, , ,844 Prepaid expenses 19,501 5,280 6,354 Accounts receivable 78,292 63,853 25,067 Due from McGill 10,051-39,477 Inventory 20,682 15,687 21,805 1,610,520 1,562,750 1,568,468 Service agreement deposits (Note 5) 45,590 49,988 - Capital assets (Note 6) 178, ,259 88,623 Art collection 5,750 5,750 5,750 1,839,934 1,830,747 1,662,841 Liabilities Current liabilities Accounts payable and accrued liabilities 633, , ,150 Due to McGill - 17, , , ,150 Contingency (Note 11) Net assets Unrestricted (operating fund) , ,112 Invested in capital assets and art collection 183, ,009 94,373 Externally-restricted funds (Note 8) , ,206 1,206,736 1,121, ,691 1,839,934 1,830,747 1,662,841 Signed on behalf of the Executive Committee..., Director..., Director The accompanying notes to the financial statements are an integral part of this financial statement. Page 4 of 12

7 THE POST-GRADUATE STUDENTS SOCIETY OF MCGILL UNIVERSITY INC.- Statement of changes in net assets year ended May 31, 2013 Operating fund Restricted fund Invested in capital assets and art Externally Unrestricted collection restricted Total $ $ $ $ Balance, as at April 1, 2011 (unaudited) 315,112 94, , ,691 Excess of revenue over expenses (expenses over revenue) 102,490 (29,684) 108, ,686 Transfer for acquisition of capital assets (100,640) 153,320 (52,680) - Balance as at May 31, 2012 (unaudited) 316, , ,406 1,121,377 Excess of revenue over expenses (expenses over revenue) 54,477 (58,761) 89,643 85,359 Transfer to special projects fund (19,903) - 19,903 - Transfer for acquisition of capital assets - 24,576 (24,576) - Balance as at May 31, , , ,376 1,206,736 The accompanying notes to the financial statements are an integral part of this financial statement. Page 5 of 12

8 Statement of cash flows year ended May 31, $ $ (unaudited) Operating activities Excess of revenue over expenses 85, ,686 Adjustment for: Amortization 58,761 29,684 Amortization of service agreement 11, , ,370 Changes in non-cash working capital balances Prepaid expenses (14,221) 1,074 Accounts receivable and due from McGill (24,490) 691 Inventory (4,995) 6,118 Service agreement deposit - (49,988) Accounts payable and accrued liabilities and due from McGill (76,172) (13,780) (119,878) (55,885) 35, ,485 Investing activities Acquisition of capital assets (24,576) (153,320) Addition to service agreement (7,000) - Net decrease (increase) in short-term investments 218,683 (303,805) 187,107 (457,125) Net increase (decrease) in cash 222,747 (301,640) Cash, beginning of year 671, ,921 Cash, end of year 894, ,281 The accompanying notes to the financial statements are an integral part of this financial statement. Page 6 of 12

9 Notes to the financial statements May 31, Organization The Post-Graduate Students Society of McGill University Inc. / L Association des étudiants postgradués de l Université McGill Inc. (the Society or PGSS ) is a democratic, non-profit corporation having its head office in the City of Montreal and is incorporated under Part III of the Companies Act (Quebec) as a not-for-profit organization. The purpose of the Society is to establish, maintain and conduct a social club for the convenience of its members and their guests to promote friendship and unity among its members and to promote the educational and cultural interests of its members. The Society receives the use of premises, referred to as Thomson House, from McGill University Inc. ( McGill ), for a nominal consideration. 2. Adoption of a new accounting framework During the year ended May 31, 2013, the Society adopted the new accounting standards for notfor-profit organizations (the new standards ) adopted by the Canadian Institute of Chartered Accountants ( CICA ). In accordance with CICA Handbook Section 1501, First-time Adoption, ( Section 1501 ), the date of transition to the new standards is June 1, 2011, and the Society has prepared and presented an opening statement of financial position at the date of transition to the new standards. This opening statement of financial position is the starting point for the entity s accounting under the new standards. In its opening statement of financial position, under the recommendations of Section 1501, the Society: a) recognized all assets and liabilities whose recognition is required by the new standards; b) did not recognize items as assets or liabilities if the new standards do not permit such recognition; c) reclassified items that it recognized previously as one type of asset, liability or component of fund balance, but are recognized as a different type of asset, liability or component of fund balance under the new standards; and d) applied the new standards in measuring all recognized assets and liabilities. In accordance with the requirements of Section 1501, the accounting policies set out in Note 3 have been consistently applied to all periods presented. The Society has elected to adopt the exemption available under Section 1501 relating to financial instruments and to record the fair value investments held at the date of transition. This exemption had no impact on the financial statements since the Society already reflected the fair value of these investments. Page 7 of 12

10 Notes to the financial statements May 31, Significant accounting policies The Society follows Canadian accounting standards for not-for profit organizations. The significant accounting policies are as follows: Revenue recognition The Society follows the restricted fund method of accounting for contributions. The revenue, expenditures and capital of the Society are maintained in accordance with the principles of fund accounting and are classified into funds in accordance with activities or objectives specified. Income from the Society s various activities is recognized as revenue when received or receivable if the amount to be received can be reasonably estimated and collection is reasonably assured. Financial instruments Financial assets and financial liabilities are initially recognized at fair value when the Society becomes a party to the contractual provisions of the financial instrument. Subsequently, all financial instruments are measured at amortized cost except for the investments, which are recorded at fair value at the statement of financial position date. Fair value of the investments is based on closing prices. Gains and losses on the sale of the investments are calculated at average cost on the trade date. Change in unrealized appreciation/depreciation on the investments represents the change in fair value of the investments between the current year and the prior year. Transaction costs related to financial instruments measured at fair value are expensed as incurred. Transaction costs related to the other financial instruments are added to the carrying value of the asset or netted against the carrying value of the liability and are then recognized over the expected life of the instrument using the straight-line method. Any premium or discount related to an instrument measured at amortized cost is amortized over the expected life of the item using the straight-line method and recognized in net income or net loss as interest income or expense. With respect to financial assets measured at cost or amortized cost, the Society recognizes in net earnings or net loss an impairment loss, if any, when it determines that a significant adverse change has occurred during the period in the expected timing or amount of future cash flows. When the extent of impairment of a previously written-down asset decreases and the decrease can be related to an event occurring after the impairment was recognized, the previously recognized impairment loss shall be reversed in net earnings in the period the reversal occurs. Page 8 of 12

11 Notes to the financial statements May 31, Significant accounting policies (continued) Inventory Inventory is valued at the lower of cost and net realizable value. Cost is determined on a specific identification basis. Net realizable value is the estimated selling price less the estimated cost necessary to make the sale. Capital assets Contributed capital assets are recorded at fair value at the date of contribution. Purchased capital assets are recorded at cost and are amortized over their estimated useful life on a declining-balance basis as follows: Use of estimates Computers and software 30% Website Database 30% Furniture, fixtures and equipment 20% Leasehold improvements 20% The preparation of financial statements in conformity with Canadian accounting standards for-notfor profit organizations require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Key components of the financial statements requiring management to make estimates include the useful lives of long-lived assets, inventory obsolescence and the fair value of investments. Actual results could differ from those estimates. 4. PGSS Retirement Savings Plan Employee future benefits The Society sponsors a defined contribution pension plan covering some of its employees. The Society contributes up to 6% of employees salaries. Pension expense incurred during the year was $12,967 ($9,792 in 2012). 5. Service agreement deposits The Society signed a five-year service level agreement in fiscal year 2012 for the ongoing support services of the data management system and website. The deposit will be expensed over the life of the agreement. Page 9 of 12

12 Notes to the financial statements May 31, Capital assets May 31, 2013 May 31, 2012 June 30, 2011 Accumulated Net book Net book Net book Cost amortization value value value $ $ $ $ $ (unaudited) (unaudited) Computers and software 17,934 8,619 9,315 9, Website Database 100,640 30,192 70, ,640 - Furniture, fixtures and equipment 594, ,441 68,512 69,622 67,570 Leasehold improvements 542, ,421 29,799 32,035 20,220 1,255,747 1,077, , ,259 88, Credit facility The Society has an available credit facility of $200,000 (2012 $200,000; 2011 $200,000), bearing interest at the bank s prime lending rate, plus 3% on amounts advanced. As at May 31, 2013, nil (2012 and 2011 nil) had been drawn on this demand loan. The bank has a $315,000 (2012 $315,000) charge on the Society s movable property as security for the demand loan. The last written agreement is dated in 2009, and the loan facility is reviewed on an annual basis. 8. Externally-restricted funds May 31, June 30, $ $ $ (unaudited) (unaudited) MCGSS Fund 14, Student Health and Dental Insurance Fund 71, , ,156 Education Bursaries Fund 197, , ,000 FEUQ Fund Grants Program Fund 8, Library Improvement Fund 2,445 2,445 - Thomas House Fund 13,722 29,791 60,216 Student Support Services Fund 179, , ,943 Retirement Savings Fund 70,536 82,859 68,891 Graduate Student Fund 112,537 51, , , ,206 Page 10 of 12

13 Notes to the financial statements May 31, Externally-restricted funds (continued) The restricted funds consist primarily of the following: The Student Health and Dental Insurance Fund, the Student Support Services Fund, the Retirement Savings Fund and the Graduate Student Fund accounts for contributions received for specific purposes, as stipulated by the contributors. The Education Bursaries Fund accounts for the collection and disbursement of fees to support graduate and post-doctoral students in good academic standing who demonstrate financial need. The Library Improvement Fund accounts for the collection and disbursement of fees to improve library resources and facilities for graduate students. Thomson House Fund accounts for the collection and disbursement of student fees specifically designated for the improvement of Thomson House. 9. Financial instruments Credit risk The Society does not have a significant exposure to credit risk as the majority of its revenue has been collected within the normal terms. Interest rate risk The Society manages its short-term investments based on its cash flow needs with a view to optimizing its interest income. The interest rate on the GICS s at year-end is approximately 1% per annum (1% in 2012; 1.25% in 2011). 10. Contractual obligations The Society leases its premises under a lease expiring May 31, In addition, the Society has entered into an annual agreement to secure daycare services for a period of four years expiring in Future payments for lease operating costs and the securing of specific daycare services will aggregate to approximately $34,000 and will include the following payments over the next year: $34,000. Page 11 of 12

14 Notes to the financial statements May 31, Contingency The Society is currently involved in litigation with the Canadian Federation of Students ( CFS ). The CFS is claiming that the Society remains a member of the CFS, and therefore will continue to owe membership fees for the future. The Society is claiming that it ceased being a member of CFS effective April 1, Neither the possible outcome nor the amount of possible settlement can be foreseen. Therefore, no provision has been made in the financial statements. The membership fees for the current 12-month period ended May 31, 2013, have not been charged to the PGSS members nor remitted to CFS by the Society. The Society is also involved in litigation where it is named a third party. No monetary claim is made by or against PGSS in that litigation. Page 12 of 12

McGILL INC. Financial Statements. May 31, 2016

McGILL INC. Financial Statements. May 31, 2016 May 31, 2016 Financial Statements L SSOCITION DES ETUDINTS POST-GRDUES DE L UNIVERSITE THE POST-GRDUTE STUDENTS SOCIETY OF McGILL UNIVERSITY INC.! - Independent auditors report 1-2 Table of contents as