BIRD STUDIES CANADA/ ÉTUDES D OISEAUX CANADA

Financial Statements of BIRD STUDIES CANADA/ ÉTUDES D OISEAUX CANADA Years ended March 31, 2013 and 2012

KPMG LLP Telephone 519-747-8800 Chartered Accountants Fax 519-747-8830 115 King Street South, 2 nd Floor Internet www.kpmg.ca Waterloo ON N2J 5A3 INDEPENDENT AUDITORS' REPORT To The Members of Bird Studies Canada/Études d Oiseaux Canada We have audited the accompanying financial statements of Bird Studies Canada/Études d Oiseaux Canada, which comprise the statements of financial position as at March 31, 2013, March 31, 2012, and April 1, 2011, the statements of operations, changes in fund balances and cash flows for the years ended March 31, 2013 and March 31, 2012, and notes, comprising 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. Auditors 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 an 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 our 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, we consider internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. KPMG LLP, is a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. KPMG Canada provides services to KPMG LLP.

Page 2 Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of the Bird Studies Canada/Études d Oiseaux Canada as at March 31, 2013, March 31, 2012 and April 1, 2011, and its results of operations and its cash flows for the years ended March 31, 2013 and March 31, 2012 in accordance with Canadian generally accepted accounting principles. Chartered Accountants, Licensed Public Accountants August 29, 2013 Waterloo, Canada

Statement of Financial Position March 31, 2013 Assets Operating Endowment Capital Baillie Tarry Murre March, 31 Fund Fund Fund Fund Fund Fund 2013 Current assets: Cash and term deposits 202,382 50 19,917 15,773 17,883 83,662 339,667 Accounts receivable (note 2) 1,085,269 1,908 16,817 19,219 - - 1,123,213 Prepaid expenses 42,783 - - - - - 42,783 1,330,434 1,958 36,734 34,992 17,883 83,662 1,505,663 Investments (note 3) - 4,203,120 - - - - 4,203,120 Property, buildings and equipment (note 4) - - 1,706,377 - - - 1,706,377 1,330,434 4,205,078 1,743,111 34,992 17,883 83,662 7,415,160 Liabilities and Fund Balances Liabilities: Accounts payable and accrued liabilities (note 5) 300,535-6,272-19,740 10,500 337,047 Deferred revenue (note 6) 692,277 - - - - - 692,277 992,812-6,272-19,740 10,500 1,029,324 Fund balances: Invested in capital assets - - 1,606,377 - - - 1,606,377 Externally restricted - 747,951 100,000 - - 73,162 921,113 Internally restricted - 3,457,127 30,462 34,992 - - 3,522,581 Unrestricted 337,622 - - - (1,857) - 335,765 337,622 4,205,078 1,736,839 34,992 (1,857) 73,162 6,385,836 Contingencies (note 9) Commitments (note 10) Subsequent event (note 12) 1,330,434 4,205,078 1,743,111 34,992 17,883 83,662 7,415,160 See accompanying notes to financial statements.

Statement of Financial Position March 31, 2012 Assets Operating Endowment Capital Baillie Tarry Murre March, 31 Fund Fund Fund Fund Fund Fund 2012 Current assets: Cash and term deposits 209,838 50 19,565 37,923 17,794 83,451 368,621 Accounts receivable (note 2) 843,328 895 27,370 21,530 - - 893,123 Prepaid expenses 64,381 - - - - - 64,381 1,117,547 945 46,935 59,453 17,794 83,451 1,326,125 Investments (note 3) - 4,014,955 - - - - 4,014,955 Property, buildings and equipment (note 4) - - 1,815,199 - - - 1,815,199 1,117,547 4,015,900 1,862,134 59,453 17,794 83,451 7,156,279 Liabilities and Fund Balances Liabilities: Accounts payable and accrued liabilities (note 5) 285,546 - - - 17,225-302,771 Deferred revenue (note 6) 527,786 - - - - - 527,786 813,332 - - - 17,225-830,557 Fund balances: Invested in capital assets - - 1,715,199 - - - 1,715,199 Externally restricted - 725,435 100,000 - - 83,451 908,886 Internally restricted - 3,290,465 46,935 59,453 - - 3,396,853 Unrestricted 304,215 - - - 569-304,784 304,215 4,015,900 1,862,134 59,453 569 83,451 6,325,722 Contingencies (note 9) Commitments (note 10) 1,117,547 4,015,900 1,862,134 59,453 17,794 83,451 7,156,279 See accompanying notes to financial statements.

Statement of Financial Position April 1, 2011 Assets Operating Endowment Capital Baillie Tarry Murre April 1, Fund Fund Fund Fund Fund Fund 2011 Current assets: Cash and term deposits 133,828 50 19,467 14,034 17,705 83,331 268,415 Accounts receivable (note 2) 992,358 833 50,060 17,967 - - 1,061,218 Prepaid expenses 55,457 - - - - - 55,457 1,181,643 883 69,527 32,001 17,705 83,331 1,385,090 Investments (note 3) - 3,955,641 - - - - 3,955,641 Property, buildings and equipment (note 4) - - 1,951,765 - - - 1,951,765 1,181,643 3,956,524 2,021,292 32,001 17,705 83,331 7,292,496 Liabilities and Fund Balances Liabilities: Accounts payable and accrued liabilities (note 5) 312,832-25,835-13,740 330 352,737 Deferred revenue (note 6) 618,339 - - - - - 618,339 Current portion of long-term debt (note 7) - - 1,265 - - - 1,265 931,171-27,100-13,740 330 972,341 Fund balances: Invested in capital assets - - 1,851,765 - - - 1,851,765 Externally restricted - 704,047 100,000 - - 83,001 887,048 Internally restricted - 3,252,477 42,427 32,001 - - 3,326,905 Unrestricted 250,472 - - - 3,965-254,437 250,472 3,956,524 1,994,192 32,001 3,965 83,001 6,320,155 Contingencies (note 9) Commitments (note 10) 1,181,643 3,956,524 2,021,292 32,001 17,705 83,331 7,292,496 See accompanying notes to financial statements.

Statement of Operations Year ended March 31, 2013 Operating Endowment Capital Baillie Tarry Murre March, 31 Fund Fund Fund Fund Fund Fund 2013 Revenue: Fees 216,115 - - - - - 216,115 Donations 289,043 46,603 1,000 100 - - 336,746 Fundraising 329,406 - - - - - 329,406 Other 76,163 1,810 - - - - 77,973 Research and conservation 4,095,725 - - - - - 4,095,725 Bank interest and exchange 3,051 18 101 124 89 211 3,594 Investment income - 163,413 - - - - 163,413 Gain on sale of investments - 91,637 - - - - 91,637 5,009,503 303,481 1,101 224 89 211 5,314,609 Expenses: Administration 327,435 19,980 - - - - 347,415 Fundraising 164,160 - - - - - 164,160 Membership services 215,436 - - - - - 215,436 Other - 2,596 - - 1,000-3,596 Research and conservation 4,307,812 - - - 28,058 10,500 4,346,370 Amortization of buildings and equipment - - 179,753 - - - 179,753 Grants - - - 20,600 - - 20,600 Write down of property, buildings and equipment - - 448 - - - 448 5,014,843 22,576 180,201 20,600 29,058 10,500 5,277,778 Excess (deficiency) of revenue over expenses before interfund transfers (5,340) 280,905 (179,100) (20,376) (28,969) (10,289) 36,831 See accompanying notes to financial statements.

Statement of Operations Year ended March 31, 2012 Operating Endowment Capital Baillie Tarry Murre March, 31 Fund Fund Fund Fund Fund Fund 2012 Revenue: Fees 229,481 - - - - - 229,481 Donations 220,728 17,651-23,131 - - 261,510 Fundraising 321,860 - - - - - 321,860 Other 96,632 1,644 - - - - 98,276 Research and conservation 3,534,192 - - - - 25,500 3,559,692 Bank interest and exchange (1,113) 17 98 291 89 121 (497) Investment income - 149,272 - - - - 149,272 Gain on sale of investments - 40,634 - - - - 40,634 4,401,780 209,218 98 23,422 89 25,621 4,660,228 Expenses: Administration 333,665 19,656 - - - - 353,321 Fundraising 100,246 - - - - - 100,246 Membership services 230,224 - - - - - 230,224 Other - 2,361 66-1,000 1 3,428 Research and conservation 3,731,375 - - - 28,403 25,170 3,784,948 Amortization of buildings and equipment - - 187,187 - - - 187,187 Grants - - - 17,500 - - 17,500 4,395,510 22,017 187,253 17,500 29,403 25,171 4,676,854 Excess (deficiency) of revenue over expenses before interfund transfers 6,270 187,201 (187,155) 5,922 (29,314) 450 (16,626) See accompanying notes to financial statements.

Statement of Changes in Fund Balances Year ended March 31, 2013 Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2013 Fund balance, beginning of year 304,215 4,015,900 1,862,134 59,453 569 83,451 6,325,722 Excess (deficiency) of revenue over expenses (5,340) 280,905 (179,100) (20,376) (28,969) (10,289) 36,831 Change in unrealized gain on investments classified as available-for-sale - 23,283 - - - - 23,283 Interfund transfers (note 8) 111,771 23,304 53,805 19,219 26,543-234,642 Interfund transfers (note 8) (73,024) (138,314) - (23,304) - - (234,642) Net interfund transfers 38,747 (115,010) 53,805 (4,085) 26,543 - - Fund balances, end of year 337,622 4,205,078 1,736,839 34,992 (1,857) 73,162 6,385,836 See accompanying notes to financial statements.

Statement of Changes in Fund Balances Year ended March 31, 2012 Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2012 Fund balance, beginning of year 250,472 3,956,524 1,994,192 32,001 3,965 83,001 6,320,155 Excess (deficiency) of revenue over expenses 6,270 187,201 (187,155) 5,922 (29,314) 450 (16,626) Change in unrealized gain on investments classified as available-for-sale - 22,193 - - - - 22,193 Interfund transfers (note 8) 124,100-55,097 21,530 25,918-226,645 Interfund transfers (note 8) (76,627) (150,018) - - - - (226,645) Net interfund transfers 47,473 (150,018) 55,097 21,530 25,918 - - Fund balances, end of year 304,215 4,015,900 1,862,134 59,453 569 83,451 6,325,722 See accompanying notes to financial statements.

Statement of Cash Flows Year ended March 31, 2013 Cash provided by (used in): Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2013 Operating activities: Excess (deficiency) of revenue over expenses (5,340) 280,905 (179,100) (20,376) (28,969) (10,289) 36,831 Items not involving cash: Amortization of property, buildings and equipment - - 179,753 - - - 179,753 Loss on disposal of property, buildings and equipment - - 448 - - - 448 Change in non-cash operating working capital balances: Accounts receivable (224,245) (1,013) 10,553 2,311 - - (212,394) Prepaid expenses 21,598 - - - - - 21,598 Accounts payable and accrued liabilities 17,294-6,272-2,515 10,500 36,581 Deferred revenue 164,490 - - - - - 164,490 (26,203) 279,892 17,926 (18,065) (26,454) 211 227,307 Investing: Purchase of investments - (188,165) - - - - (188,165) Change in unrealized gain on investments - 23,283 - - - - 23,283 Purchase of property, buildings and equipment - - (71,379) - - - (71,379) - (164,882) (71,379) - - - (236,261) Increase (decrease) in cash (26,203) 115,010 (53,453) (18,065) (26,454) 211 (8,954) Cash, beginning of year 209,838 50 19,565 37,923 17,794 83,451 368,621 Net interfund transfers 38,747 (115,010) 53,805 (4,085) 26,543 - - Cash, end of year 222,382 50 19,917 15,773 17,883 83,662 359,667 Cash is defined as: Cash and term deposits 222,382 50 19,917 15,773 17,883 83,662 359,667 See accompanying notes to financial statements.

Statement of Cash Flows Year ended March 31, 2012 Cash provided by (used in): Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2012 Operating activities: Excess (deficiency) of revenue over expenses 6,270 187,201 (187,155) 5,922 (29,314) 450 (16,626) Items not involving cash: Amortization of property, buildings and equipment - - 187,187 - - - 187,187 Change in non-cash operating working capital balances: Accounts receivable 151,334 (62) 22,690 (3,563) - - 170,399 Prepaid expenses (8,924) - - - - - (8,924) Accounts payable and accrued liabilities (29,591) - (25,835) - 3,485 (330) (52,271) Deferred revenue (90,552) - - - - - (90,552) 28,537 187,139 (3,113) 2,359 (25,829) 120 189,213 Investing: Purchase of investments - (59,314) - - - - (59,314) Change in unrealized gain on investments - 22,193 - - - - 22,193 Purchase of property, buildings and equipment - - (50,621) - - - (50,621) - (37,121) (50,621) - - - (87,742) Financing: Payment of long-term debt - - (1,265) - - - (1,265) - - (1,265) - - - (1,265) Increase (decrease) in cash 28,537 150,018 (54,999) 2,359 (25,829) 120 100,206 Cash, beginning of year 133,828 50 19,467 14,034 17,705 83,331 268,415 Net interfund transfers 47,473 (150,018) 55,097 21,530 25,918 - - Cash, end of year 209,838 50 19,565 37,923 17,794 83,451 368,621 Cash is defined as: Cash and term deposits 209,838 50 19,565 37,923 17,794 83,451 368,621 See accompanying notes to financial statements.

Notes to Financial Statements Years ended March 31, 2013 and 2012 Bird Studies Canada/Études d Oiseaux Canada (BSC) (the Organization ) is incorporated without share capital under the laws of the province of Ontario. The mission of BSC is to advance and encourage the wider understanding, appreciation and conservation of wild birds and their habitats, in Canada and elsewhere, through studies using the skills, enthusiasm and support of its members, volunteers, staff and the interested public. The Organization is a registered charity under the Income Tax Act and, accordingly, is exempt from income taxes, provided certain requirements of the Income Tax Act are met. On April 1, 2012, the Organization adopted Canadian Accounting Standards for Not-For-Profit Organizations in Part III of the CICA Handbook. These are the first financial statements prepared in accordance with accounting standards for not-for-profit organizations. In accordance with the transitional provisions in accounting standards for not-for-profit organizations, the Organization has adopted the changes retrospectively, subject to certain exemptions allowed under these standards. The transition date is April 1, 2011 and all comparative information provided has been presented by applying accounting standards for not-for-profit organizations. As a result of transitioning to these new standards, there is no impact to the financial statements and thus no transitional adjustments are required to be booked to net assets nor excess of revenue over expenses. 1. Summary of significant accounting policies and reporting practices: (a) Fund accounting: BSC follows the restricted fund method of accounting for contributions. The purpose of the funds is as follows: (i) Operating Fund: The Operating Fund accounts for the Organization s program and administrative activities. The fund reports unrestricted resources and restricted operating program grants. (ii) Endowment Fund: The Endowment Fund reports resources contributed for endowment. Investment income earned on resources of the Endowment Fund is reported in the accounts of this fund. (iii) Capital Fund: The Capital Fund reports the assets, liabilities, revenue and expenses related to BSC s property, buildings and equipment.

Notes to Financial Statements, page 2 Years ended March 31, 2013 and 2012 1. Summary of significant accounting policies and reporting practices (continued): (a) Fund accounting (continued): (iv) Baillie Fund: The James L. Baillie Memorial Fund (Baillie Fund) reports the assets, liabilities, revenue and expenses related to the Baillie Fund. The fund provides grants to individuals or groups for projects that relate to the dissemination of knowledge, contribution to the preservation of Canadian birds and the study of their natural environment. (v) Tarry Fund: The Doug Tarry Natural History Fund (Tarry Fund) reports the assets, liabilities, revenue and expenses related to the Tarry Fund. The fund provides educational support to students with respect to the study of Canadian birds. (vi) Murre Fund: The Murre Fund reports the assets, liabilities, revenue and expenses related to the Murre Fund. The fund provides grants to individuals or groups that relate to the preservation of Murre habitat. (b) Financial instruments: Financial instruments are recorded at fair value on initial recognition. Freestanding derivative instruments that are not in a qualifying hedging relationship and equity instruments that are quoted in an active market are subsequently measured at fair value. All other financial instruments are subsequently recorded at cost or amortized cost, unless management has elected to carry the instruments at fair value. The Organization has not elected to carry any such financial instruments at fair value. Transaction costs incurred on the acquisition of financial instruments measured subsequently at fair value are expensed as incurred. All other financial instruments are adjusted by transaction costs incurred on acquisition and financing costs, which are amortized using the effective interest rate method. Financial assets are assessed for impairment on an annual basis at the end of the fiscal year if there are indicators of impairment. If there is an indicator of impairment, the Organization determines if there is a significant adverse change in the expected amount or timing of future cash flows from the financial asset. If there is a significant adverse change in the expected cash flows, the carrying value of the financial asset is reduced to the highest of the present value of the expected cash flows, the amount that could be realized from selling the financial asset or the amount the Organization expects to realize by exercising its right to any collateral. If events and circumstances reverse in a future period, an impairment loss will be reversed to the extent of the improvement, not exceeding the initial carrying value.

Notes to Financial Statements, page 3 Years ended March 31, 2013 and 2912 1. Summary of significant accounting policies and reporting practices (continued): (c) Property, buildings and equipment: Property, buildings and equipment are recorded at cost. Amortization is provided using the following method and annual rates: Asset Basis Rate Headquarters buildings Straight-line 25 years Old Cut field station and visitor centre Straight-line 20 years Remote Long Point field stations Straight-line 10 years Kiosks, barn and lab Straight-line 5 years Vehicles Straight-line 5 years Equipment Straight-line 10 years Network, computers and equipment Straight-line 3 years Leasehold improvements Straight-line Lease term When property, buildings and equipment no longer contribute to BSC s ability to provide services, their carrying amount is written down to their residual value. (d) Revenue recognition: Restricted contributions related to general operations are recognized as revenue of the Operating Fund in the year in which the related expenses are incurred. All other restricted contributions are recognized as revenue of the appropriate restricted fund. Unrestricted contributions are recognized as revenue of the Operating Fund in the year pledged if the amount to be received can be reasonably estimated and collection is reasonably assumed. Contributions for endowment are recognized as revenue in the Endowment Fund. Investment income earned in the Endowment Fund is recognized as revenue in the Endowment Fund. Other restricted income is recognized in the fund to which it relates.

Notes to Financial Statements, page 4 Years ended March 31, 2013 and 2012 1. Summary of significant accounting policies and reporting practices (continued): (e) Use of estimates: The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amount of revenue and expenses during the year. Significant items subject to such estimates and assumptions include the carrying amount of property, buildings and equipment, accounts payable and accrued liabilities and valuation allowance for receivables. Actual results could differ from those estimates. (f) Donated materials and services: Donated materials and services, which would otherwise be paid by the Organization, are recorded at fair value when determinable. A substantial number of volunteers have made significant contributions of their time to the Organization s program and support services. The value of this contributed time is not reflected in these statements. (g) Deferred revenue: Program grants received before the statement of financial position date, for programs to be completed for periods after the statement of financial position date, are deferred to the following year and disclosed as deferred revenue on the statement of financial position. 2. Accounts receivable: Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2013 Trade 1,048,758 1,000 - - - - 1,049,758 Due from Operating - 908 16,817 19,219 - - 36,944 Due from Endowment - - - - - - - Due from Capital 6,271 - - - - - 6,271 Due from Tarry 19,740 - - - - - 19,740 Due from Murre 10,500 - - - - - 10,500 1,085,269 1,908 16,817 19,219 - - 1,123,213

Notes to Financial Statements, page 5 Years ended March 31, 2013 and 2012 2. Accounts receivable (continued): Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2012 Trade 826,103 - - - - - 826,103 Due from Operating - 895 27,370 21,530 - - 49,795 Due from Endowment - - - - - - - Due from Capital - - - - - - - Due from Tarry 17,225 - - - - - 17,225 Due from Murre - - - - - - - 843,328 895 27,370 21,530 - - 893,123 Operating Endowment Capital Baillie Tarry Murre April 1, Fund Fund Fund Fund Fund Fund 2011 Trade 952,453 - - - - - 952,453 Due from Operating - 833 50,060 17,967 - - 68,860 Due from Endowment - - - - - - - Due from Capital 25,835 - - - - - 25,835 Due from Tarry 13,740 - - - - - 13,740 Due from Murre 330 - - - - - 330 992,358 833 50,060 17,967 - - 1,061,218 3. Investments: Investments consist of: March 31, 2013 March 31, 2012 April 1, 2011 Market value Cost Market value Cost Market value Cost $ $ $ $ $ $ Endowment fund: Quoted shares 2,495,974 1,778,371 1,978,336 1,309,043 1,945,062 1,252,233 Fixed income 1,237,702 1,153,630 1,781,371 1,665,286 1,743,536 1,672,432 Cash and money market 469,444 469,444 255,248 255,247 267,043 267,042 4,203,120 3,401,445 4,014,955 3,229,576 3,955,641 3,191,707

Notes to Financial Statements, page 6 Years ended March 31, 2013 and 2012 3. Investments (continued): Cost March 31, 2013 Market value Endowment fund: Short-term $ 3,401,445 $ 4,203,120 Fund allocation based on market value is as follows: Baillie account 24,888 Tarry account 1,717,770 Long Point Bird Observatory account 823,018 Long Point Waterfowl and Wetlands: Research Fund account 747,951 Building 319,536 General account 569,957 $ 4,203,120 Cost March 31, 2012 Market value Endowment fund: Short-term $ 3,229,576 $ 4,014,955 Fund allocation based on market value is as follows: Tarry account 1,639,293 Long Point Bird Observatory account 799,174 Long Point Waterfowl and Wetlands: Research Fund account 725,435 Building 314,944 General account 536,109 $ 4,014,955

Notes to Financial Statements, page 7 Years ended March 31, 2013 and 2012 3. Investments (continued): Cost April 1, 2011 Market value Endowment fund: Short-term $ 3,191,707 $ 3,955,641 Fund allocation based on market value is as follows: Tarry account 1,586,929 Long Point Bird Observatory account 811,132 Long Point Waterfowl and Wetlands: Research Fund account 704,047 Building 327,547 General account 525,986 $ 3,955,641 The fixed income investments have a weighted average effective interest rate of 4.17% (March 31, 2012-4.02%; April 1, 2011-4.21%) and a weighted average term to maturity of 3.51 years (March 31, 2012-4.08 years; April 1, 2011-4.73) 4. Property, buildings and equipment: March 31, 2013 Accumulated Net book Cost amortization value Headquarters land $ 216,000 $ - $ 216,000 Headquarters buildings 1,924,476 817,425 1,107,051 Old Cut property 82,701-82,701 Old Cut field station and visitor centre 190,842 135,280 55,562 Remote Long Point field stations 143,335 129,959 13,376 Vehicles 288,307 240,868 47,439 Network, computers and equipment 435,785 381,763 54,022 Kiosks 185,938 182,436 3,502 Leasehold improvements 195,465 72,321 123,144 Barn and lab 135,521 131,941 3,580 $3,798,370 $ 2,091,993 $1,706,377

Notes to Financial Statements, page 8 Years ended March 31, 2013 and 2012 4. Property, buildings and equipment (continued): March 31, 2012 Accumulated Net book Cost amortization value Headquarters land $ 216,000 $ - $ 216,000 Headquarters buildings 1,924,476 741,738 1,182,738 Old Cut property 82,701-82,701 Old Cut field station and visitor centre 190,842 125,738 65,104 Remote Long Point field stations 143,335 125,651 17,684 Vehicles 291,770 257,039 34,731 Network, computers and equipment 407,171 368,076 39,095 Kiosks 185,938 163,842 22,096 Leasehold improvements 195,465 52,774 142,691 Barn and lab 135,521 123,162 12,359 $3,773,219 $ 1,958,020 $1,815,199 April 1, 2011 Accumulated Net book Cost amortization value Headquarters land $ 216,000 $ - $ 216,000 Headquarters buildings 1,921,167 666,418 1,254,749 Old Cut property 82,701-82,701 Old Cut field station and visitor centre 190,842 116,135 74,707 Remote Long Point field stations 129,593 121,120 8,473 Vehicles 282,208 238,711 43,497 Network, computers and equipment 421,409 365,808 55,601 Kiosks 185,938 145,249 40,689 Leasehold improvements 183,247 33,810 149,437 Barn and lab 135,521 109,610 25,911 $3,748,626 $ 1,796,861 $1,951,765

Notes to Financial Statements, page 9 Years ended March 31, 2013 and 2012 5. Accounts payable and accrued liabilities: Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2013 Trade and accrued liabilities 263,591 - - - - - 263,591 Due to Operating - - 6,271-19,740 10,500 36,512 Due to Endowment 908 - - - - - 908 Due to Capital 16,817 - - - - - 16,817 Due to Baillie 19,219 - - - - - 19,219 Due to Tarry - - - - - - - 300,535-6,271-19,740 10,500 337,047 Operating Endowment Capital Baillie Tarry Murre March 31, Fund Fund Fund Fund Fund Fund 2012 Trade and accrued liabilities 235,751 - - - - - 235,751 Due to Operating - - - - 17,225-17,225 Due to Endowment 895 - - - - - 895 Due to Capital 27,370 - - - - - 27,370 Due to Baillie 21,530 - - - - - 21,530 Due to Tarry - - - - - - - 285,546 - - - 17,225-302,771 Operating Endowment Capital Baillie Tarry Murre April 1, Fund Fund Fund Fund Fund Fund 2011 Trade and accrued liabilities 243,972 - - - - - 243,972 Due to Operating - - 25,835-13,740 330 39,905 Due to Endowment 833 - - - - - 833 Due to Capital 50,060 - - - - - 50,060 Due to Baillie 17,967 - - - - - 17,967 Due to Tarry - - - - - - - 312,832-25,835-13,740 330 352,737 Included in accounts payable and accrued liabilities are government remittances payable of $59,351 (March 31, 2012 - $56,878; April 1, 2011 - $50,614), which includes amounts payable for HST and payroll related taxes.

Notes to Financial Statements, page 10 Years ended March 31, 2013 and 2012 6. Deferred revenue: This account represents money that was invoiced or received in the current year which will be expended on projects in the subsequent year. 7. Long-term debt: March 31, March 31, April 1, 2013 2012 2011 7.10% term loan payable in blended monthly payments of principal and interest of $463, secured by a vehicle, due March 2012 $ - $ - $ 1,265 Current portion - - 1,265 $ - $ - $ - The remaining principal on long-term debt was paid in full in 2012. 8. Interfund transfers and internally restricted fund balances: In fiscal 2007, the Board of Directors, consistent with the terms of the endowment, authorized the segregation of $300,000 of internally restricted funds for the Capital Fund. Investment income and capital gains from the $300,000 are to be used to fund maintenance of the capital assets and operations of the headquarters building. During the year, $138,314 was transferred from the Endowment Fund: $111,771 into the Operating Fund to cover $23,386 of budgeted expenses of the Long Point Waterfowl and Wetlands Research Fund and $88,385 for operational expenses $26,543 into the Tarry Fund to fund the annual Young Ornithologists Workshop During the year, $73,024 was transferred from the Operating Fund: $53,805 into the Capital Fund to purchase capital assets $19,219 in proceeds from the Birdathon was transferred to the Baillie Fund to provide grants to individuals or groups for projects that relate to the dissemination of knowledge, contribution to the preservation of Canadian birds and the study of their natural environment During the year, $23,304 was transferred from the Baillie Fund into the Endowment fund to purchase investments to earn income for future use of the Baillie Fund.

Notes to Financial Statements, page 11 Years ended March 31, 2013 and 2012 9. Contingencies: BSC has a 99 year agreement with the Ontario Heritage Foundation to maintain and preserve the headquarters property in a manner as outlined in the agreement. If breached, BSC will be required to return a $100,000 grant received from the Foundation during 1995 to assist in the purchase of this property. 10. Commitments: Future minimum payments under an operating lease for office equipment are as follows: 2014 1,680 11. Financial risks: (a) Currency risk: The Organization transacted minimal amounts in foreign currency and, therefore, has limited exposure to foreign exchange fluctuations. (b) Credit risk: Credit risk refers to the risk that a counterparty may default on its contractual obligations resulting in a financial loss. The Organization is exposed to credit risk with respect to the accounts receivable. The Organization assesses, on a continuous basis, accounts receivable and provides for any amounts that are not collectible in the allowance for doubtful accounts. Management has determined that no allowance for doubtful accounts is required at March 31, 2013. (c) Liquidity risk: Liquidity risk is the risk that the Organization will be unable to fulfill its obligations on a timely basis or at a reasonable cost. The Organization manages its liquidity risk by monitoring its operating requirements. The Organization prepares budget forecasts to ensure it has sufficient funds to fulfill its obligations. There has been no change to the risk exposures from 2012. (d) Interest rate risk: The Organization is exposed to interest rate risk on its fixed interest rate financial instruments. Further details about the fixed rate investments are included in note 3 and the long-term debt are included in note 7.

Notes to Financial Statements, page 12 Years ended March 31, 2013 and 2012 12. Subsequent event: Subsequent to the year end, the Organization entered an understanding with Environment Canada, whereby Environment Canada will provide the Organization $728,000 in annual funding for three years.