Notes to Consolidated Financial Statements Year ended December 31, 2016 2. Significant accounting policies (continued): (l) Employee future benefits: The City and its employees participate in the Municipal Pension Plan. The Municipal Pension Plan is a multi-employer contributory defined benefit pension plan. Payments in the year are expensed. Sick leave benefits and retirement severance benefits are also available to the City’s employees. The costs of these benefits are actuarially determined based on service and best estimates of retirement ages and expected future salary and wage increases. The obligation under these benefit plans are accrued based on projected benefits as the employees render services necessary to earn the future benefits. (m) Use of accounting estimates: The preparation of 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 date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Significant areas requiring the use of management estimates relate to the determination of accrued sick benefits, allowance for doubtful accounts receivable, useful lives of tangible capital assets, and provision for contingencies. Actual results could differ from those estimates. Adjustments, if any, will be reflected in the financial statements in the period that the change in estimate is made, as well as in the period of settlement if the amount is different. (n) Segment disclosures: A segment is defined as a distinguishable activity or group of activities of a government for which it is appropriate to separately report financial information to achieve the objectives of the standard. The City has provided definitions of segments used by the City as well as presented financial information in segmented format (note 18). 3. Cash and temporary investments:
2016 $
Operating funds, unrestricted Reserve funds, internally restricted Deferred revenue and deposits, restricted
$
279,906,512 $
232,282,924
111,509,524
59,319,729
62,793,481
56,359,170
454,209,517 $
347,961,823
2016 $
Cash balances
2015
72,422,850
2015 $
78,975,477
Temporary investments: 381,786,667
Money market securities and bonds maturing within three years
$
454,209,517
268,986,346 $
347,961,823
Average portfolio yield is 1.63% (2015 - 1.57%). The City has available a revolving facility up to a maximum of $5,000,000 which bears interest at an annual rate of bank prime less 0.50% per annum, and standby letters of credit up to a maximum of $100,000, for its ongoing operating requirements. The City also has available a revolving facility of $500,000 which bears interest at an annual rate of bank prime for its ongoing capital requirements. The City provided security for these facilities by way of a general security agreement. No amounts are outstanding under these banking facilities.
City of Coquitlam 2016 ANNUAL REPORT
39