ASSOCIATION OF ALBERTA MUNICIPALITIES

Notes to the Consolidated Financial Statements

Year ended December 31, 2022

2. Restricted cash:

Where required by contract agreements, ABmunis receives cash deposits from certain municipalities participating in the Clean Energy Improvement Program (CEIP) as an advance on project-related payments to be made by ABmunis on behalf of the participating municipalities. Funds are held in separate bank accounts, each designated as a deposit account for the respective municipality. Cash is transferred to the general operating account as required to reimburse ABmunis for payments made on behalf of those municipalities.

ABmunis holds cash on deposit for members who participate in a defined contribution pension plan. Cash is received from the participants and ABmunis subsequently transfers this cash to the plan fund holder. The cash is held in a separate bank account that is designated as a deposit account for the plan participants.

3. ASO funds held on deposit and ASO claim costs and claim administration expenses:

ABmunis assumes the underwriting risk for extended health care and dental policies under the ASO program, and engages a third party administrator to manage the claim activities.

ASO funds held on deposit, classified as non-current on the statement of financial position, is the minimum deposit required by the administrator. It is not ABmunis’s intent to access these funds within the next year.

ASO claim costs and claim administration expenses are compromised of the following:

ASO funds held on deposit by the claim administrator are interest bearing at the bank's 90 day treasury bill rate less 0.5% (2021 - 0.5%). Interest earned on ASO funds held on deposit is recorded as a reduction in ASO claim costs and claim administration expenses on the statement of operations.

ASO funds payable of $739,191 (2021 - $4,125,711) consist of health and dental claims costs owing.