Non-Consolidated Financial Statements of the Ottawa Hospital
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Non-consolidated financial statements of The Ottawa Hospital March 31, 2015 The Ottawa Hospital March 31, 2015 Table of contents Independent Auditor’s Report ............................................................................................................................ 1-2 Non-consolidated statement of financial position .................................................................................................. 3 Non-consolidated statement of operations ............................................................................................................ 4 Non-consolidated statement of changes in net assets .......................................................................................... 5 Non-consolidated statement of cash flow .............................................................................................................. 6 Notes to the non-consolidated financial statements ........................................................................................ 7-20 Deloitte LLP 1600 - 100 Queen Street Ottawa ON K1P 5T8 Canada Tel.: (613) 236-2442 Fax: (613) 236-2195 www.deloitte.ca Independent Auditor's Report To the Board of Governors of The Ottawa Hospital and the Ministry of Health and Long-Term Care of Ontario We have audited the accompanying non-consolidated financial statements of The Ottawa Hospital (the “Hospital”), which comprise the non-consolidated statement of financial position as at March 31, 2015, and the non-consolidated statements of operations, changes in net assets and cash flow for the year then ended, and a summary of significant accounting policies and other explanatory information. The non- consolidated financial statements have been prepared by management in accordance with the basis of accounting described in Note 2 to the financial statements to comply with the financial reporting requirements of the Ministry of Health and Long-Term Care of Ontario. Management's Responsibility for the Non-Consolidated Financial Statements Management is responsible for the preparation and fair presentation of these non-consolidated financial statements in accordance with the basis of accounting described in Note 2 to the financial statements, and for such internal control as management determines is necessary to enable the preparation of non- consolidated 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 non-consolidated 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 non-consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the non-consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the non-consolidated 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 non-consolidated 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 non-consolidated financial statements. 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 non-consolidated financial statements present fairly, in all material respects, the financial position of the Hospital as at March 31, 2015, and the results of its operations and its cash flows for the year then ended in accordance with the basis of accounting described in Note 2 to the financial statements. Basis of Accounting Without modifying our opinion, we draw attention to Note 2 to the non-consolidated financial statements, which describes the basis of accounting. The non-consolidated financial statements are prepared to assist the Hospital to meet the requirements of the Ministry of Health and Long-Term Care of Ontario. As a result, the non-consolidated financial statements may not be suitable for another purpose. Other Matter The Hospital has prepared a separate set of consolidated financial statements for the year ended March31, 2015 in accordance with Canadian public sector accounting standards for government not-for-profit organizations, on which we issued a separate auditor's report to the Board of Governors of the Hospital dated June 3, 2015. Chartered Professional Accountants, Chartered Accountants Licensed Public Accountants June 3, 2015 Page 2 The Ottawa Hospital Non-consolidated statement of financial position as at March 31, 2015 (in thousands of dollars) 2015 2014 $ $ Assets Current assets Cash 12,962 20,610 Short-term investments 1,572 1,551 Accounts receivable (Note 3) 74,578 62,249 Inventories 15,806 14,873 Prepaid expenses 9,961 6,987 114,879 106,270 Capital grants receivable (Note 3) 10,201 11,719 Assets restricted for capital purchases (Note 4) 104,992 88,443 Capital assets (Note 5) 584,292 576,904 Funds held in trust (Note 6) 29,713 31,231 844,077 814,567 Liabilities Current liabilities Accounts payable and accrued liabilities 201,379 210,631 Deferred contributions 12,487 11,283 213,866 221,914 Employee future benefits (Note 8) 50,428 46,217 Deferred contributions related to capital assets (Note 9) 420,628 410,878 Funds held in trust (Note 6) 29,713 31,231 714,635 710,240 Commitments, contingencies and guarantees (Note 16) Net assets (deficiency) Invested in capital assets (Note 11) 214,759 213,062 Unrestricted deficiency (85,317) (108,735) 129,442 104,327 844,077 814,567 Approved by the Board Chairman President and CEO See accompanying notes to the financial statements. Page 3 The Ottawa Hospital Non-consolidated statement of operations year ended March 31, 2015 (in thousands of dollars) 2015 2014 $ $ Revenue Ministry of Health and Long-Term Care of Ontario 858,820 877,226 Patient services 120,863 118,938 Recoveries and other operating 69,457 55,523 Preferred accomodation 9,849 10,806 Marketed services 7,475 7,447 Investment 1,639 943 Amortization of deferred contributions related to major equipment (Note 9) 7,111 5,545 Connecting Northern & Eastern Ontario (Note 17) 9,107 - 1,084,321 1,076,428 Expenses Salaries and wages 531,952 501,844 Employee benefits 137,840 134,677 Supplies and other operating 177,027 200,571 Medical and surgical supplies 62,431 61,764 Medical staff remuneration 70,711 73,388 Drugs 66,248 59,889 Interest 517 216 Amortization of major equipment 28,227 34,825 Connecting Northern & Eastern Ontario Program (Note 17) 9,107 - 1,084,060 1,067,174 Excess of revenue over expenses before the undernoted items and non-recurring item 261 9,254 Parking revenue 18,400 17,330 Parking expenses (5,912) (9,239) Amortization of deferred contributions related to buildings (Note 9) 14,028 13,834 Amortization of buildings and land improvements (24,768) (23,997) Excess of revenue over expenses after the overnoted items but before non-recurring item 2,009 7,182 Non-recurring funding (Note 19) 23,106 23,107 Excess of revenue over expenses 25,115 30,289 See accompanying notes to the financial statements. Page 4 The Ottawa Hospital Non-consolidated statement of changes in net assets year ended March 31, 2015 (in thousands of dollars) Invested in capital assets Unrestricted 2015 2014 $ $ $ $ (Note 11) Balance, beginning of year 213,062 (108,735) 104,327 74,038 Excess of revenue over expenses - 25,115 25,115 30,289 Net change in investment in capital assets (Note 11) 1,697 (1,697) - - Balance, end of year 214,759 (85,317) 129,442 104,327 See accompanying notes to the financial statements. Page 5 The Ottawa Hospital Non-consolidated statement of cash flow year ended March 31, 2015 (in thousands of dollars) 2015 2014 $ $ Operating activities Excess of revenue over expenses 25,115 30,289 Items not affecting cash: Amortization of capital assets 52,995 58,822 Amortization of deferred contributions related to capital assets (21,139) (19,379) Gain on disposal of capital assets (968) (7) Net increase in employee future benefits (Note 8) 4,211 2,410 60,214 72,135 Changes in non-cash operating working capital items (Note 15) (24,305) (35,673) 35,909 36,462 Financing activities Deferred contributions related to capital assets received (Note 9) 15,013 14,965 Proceeds on disposal of capital assets 4,024 7 19,037 14,972 Capital activities Purchase of capital assets (47,563) (42,788) Investing activities Net decrease (increase) in capital grants receivable 1,518 (322) Increase in assets restricted for capital purchases (16,549) (7,421) (15,031) (7,743) Net cash (outflow) inflow (7,648) 903 Cash, beginning of year 20,610 19,707 Cash, end of year 12,962 20,610 Cash includes $5,342 that is restricted for the HIROC Claim Defense Fund. See accompanying notes to the financial statements. Page 6 The Ottawa Hospital Notes to the non-consolidated financial statements March 31, 2015 (in thousands of dollars)