STATEMENT OF FINANCIAL INFORMATION FOR THE FISCAL YEAR ENDED MARCH 31, 2019 TABLE OF CONTENTS Documents are arranged in the following order: 1. Statement of Financial Information Approval 2. Management Report 3. Audited Financial Statements 4. Schedule of Debt 5. Schedule of Guarantee and Indemnity Agreements 6. Statement of Severance Agreements 7. Explanation of Differences to Audited Financial Statements 8. Schedule of Remuneration and Expenses 9. Schedule of Payments to Suppliers of Goods and Services SELKIRK COLLEGE STATEMENT OF FINANCIAL INFORMATION APPROVAL Fiscal Year Ended March 31, 2019 The undersigned represents the Board of Governors of Selkirk College and approves all the statements and schedules included in this Statement of Financial Information, produced under the Financial Information Act. __________________________________________ Bruce LeRose Chairperson, Selkirk College Board September 28, 2019 Prepared pursuant to the Financial Information Regulation, Schedule 1, section 9 SELKIRK COLLEGE MANAGEMENT REPORT Fiscal Year Ended March 31, 2019 The Financial Statements contained in this Statement of Financial Information under the Financial Information Act have been prepared by management in accordance with generally accepted accounting principles and the integrity and objectivity of these statements are management's responsibility. Management is also responsible for all the statements and schedules and for ensuring this information is consistent, where appropriate, with the information contained in the financial statements and for implementing and maintaining a system of internal controls to provide reasonable assurance that reliable financial information is produced. The Board of Governors is responsible for ensuring that management fulfils its responsibilities for financial reporting and internal control and exercises this responsibility through the Audit Committee of the Board. The Audit Committee meets with management and the external auditors two times a year. The College’s Finance Committee has the responsibility for assessing the management systems and practices of the College. The external auditors, BDO Canada LLP, conduct an independent examination, in accordance with generally accepted auditing standards, and express their opinion on the financial statements. Their examination does not relate to the other schedules and statements required by the Financial Information Act. Their examination includes a review and evaluation of the College's system of internal control and appropriate tests and procedures to provide reasonable assurance that the financial statements are presented fairly. The external auditors have full and free access to the Audit Committee of the Board and meet with it on a regular basis. On behalf of Selkirk College __________________________________________ Kerry Clarke Vice President College Services, CFO September 28, 2019 Prepared pursuant to Financial Information Regulation, Schedule 1, section 9 SELKIRK COLLEGE CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2019 SELKIRK COLLEGE INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS For the Year Ended March 31, 2019 Management's Responsibility for Financial Reporting Independent Auditor's Report Financial Statements Consolidated Statement of Financial Position Consolidated Statement of Operations and Accumulated Surplus Consolidated Statement of Change in Net Financial Debt Consolidated Statement of Cash Flows Notes to the Consolidated Financial Statements Management’s Responsibility for Financial Reporting The accompanying consolidated financial statements and related financial information are the responsibility of Selkirk College management and have been approved by the Board of Governors of Selkirk College. The Financial Statements were prepared in accordance with Generally Accepted Accounting Principles and the financial directives of the Ministry of Advanced Education and, of necessity, include some amounts that are based on estimates and judgments. To discharge its responsibility for the integrity and objectivity of financial reporting, management maintains a system of internal accounting controls comprising written policies, standards and procedures, a formal authorization structure and satisfactory processes for reviewing internal controls. This system is designed to provide management with reasonable assurance that transactions are in accordance with governing legislation, are properly authorized, reliable financial records are maintained, and assets are adequately accounted for and safeguarded. The Board of Governors has established a code of ethics and corporate directives, which require communication of the code to the employees. The Board of Governors carries out its responsibility for the financial statements through the Board Finance/Audit Committee. This Committee meets with management and the external auditor to discuss and review financial matters and recommends the financial statements to the Board for approval. The external auditor has full and free access to the Finance/Audit Committee. ________________________________________ Angus Graeme, President & CEO May 16, 2019 ________________________________________ Barb Ihlen, Director of Finance & Ancillary Services May 16, 2019 SELKIRK COLLEGE CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at March 31, 2019 2019 2018 FINANCIAL ASSETS Cash and cash equivalents (Note 3) $ 12,137,595 $ 12,357,391 Accounts receivable (Note 4) 2,860,378 1,684,140 Inventories for resale (Note 5) 345,848 414,608 Portfolio investments (Note 6) 9,602,600 9,334,279 24,946,421 23,790,418 LIABILITIES Accounts payable and accrued liabilities (Note 7) 6,195,593 7,523,845 Deferred revenue (Note 8) 8,044,407 7,985,486 Employee future benefits (Note 9) 5,015,810 4,834,043 Deferred capital contributions (Note 10) 45,344,560 32,761,056 64,600,370 53,104,430 NET FINANCIAL DEBT (39,653,949) (29,314,012) NON-FINANCIAL ASSETS Tangible capital assets (Note 11) 52,501,775 41,597,834 Inventories held for use 61,471 27,140 Prepaid expenses 643,019 762,894 53,206,265 42,387,868 ACCUMULATED SURPLUS (Note 12) $ 13,552,316 $ 13,073,856 Contractual rights (Note 13) Contractual obligations (Note 14) Chairperson, Board of Directors Director of Finance & Ancillary Services The accompanying notes form an integral part of these consolidated financial statements 2 SELKIRK COLLEGE CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED SURPLUS For the Year Ended March 31, 2019 2019 2019 2018 Budget Actual Actual REVENUE Government grants $ 29,634,480 $ 28,808,275 $ 27,186,788 Industry Trades Authority funding 1,845,816 1,788,208 1,814,351 Tuition 12,168,729 12,796,422 12,179,484 Sales 2,399,000 2,372,414 2,345,771 Investment income 300,000 588,301 472,413 Donations 200,000 247,434 255,543 Amortization of deferred capital contributions 1,736,905 1,774,682 1,373,800 Contracts and other revenue 3,034,766 3,574,200 3,309,437 51,319,696 51,949,936 48,937,587 EXPENSES (Note 15) Education programming 25,498,078 25,297,750 24,127,810 Student support 5,935,268 5,674,155 5,544,727 Research and innovation 1,565,966 1,517,158 1,177,192 Administrative support 6,258,878 6,627,862 5,868,795 Facilities support 9,417,896 9,694,817 8,740,391 Ancillary services 2,183,610 2,213,439 2,153,800 Awards and related costs 460,000 542,375 513,487 51,319,696 51,567,556 48,126,202 Annual surplus before endowment contributions - 382,380 811,385 Endowment contributions - 96,080 48,446 ANNUAL SURPLUS - 478,460 859,831 ACCUMULATED SURPLUS, beginning of year 13,073,856 13,073,856 12,214,025 ACCUMULATED SURPLUS, end of year $ 13,073,856 $ 13,552,316 $ 13,073,856 The accompanying notes form an integral part of these consolidated financial statements 3 SELKIRK COLLEGE CONSOLIDATED STATEMENT OF CHANGE IN NET FINANCIAL DEBT For the Year Ended March 31, 2019 2019 2019 2018 Budget Actual Actual ANNUAL SURPLUS $ - $ 478,460 $ 859,831 Acquisition of tangible capital assets - (12,706,154) (12,489,756) Amortization of tangible capital assets 1,771,363 1,802,213 1,403,431 1,771,363 (10,903,941) (11,086,325) (Acquisition) consumption of inventories held for use - (34,331) 5,014 Use (acquisition) of prepaid expenses - 119,875 (487,300) - 85,544 (482,286) Change in net financial debt 1,771,363 (10,339,937) (10,708,780) NET FINANCIAL DEBT, beginning of year (29,314,012) (29,314,012) (18,605,232) NET FINANCIAL DEBT, end of year $(27,542,649) $(39,653,949) $ (29,314,012) The accompanying notes form an integral part of these consolidated financial statements 4 SELKIRK COLLEGE CONSOLIDATED STATEMENT OF CASH FLOWS For the Year Ended March 31, 2019 2019 2018 CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES Annual Surplus $ 478,460 $ 859,831 Items Not Requiring an Outlay of Cash Amortization of tangible capital assets 1,802,213 1,403,431 Amortization of deferred capital contributions (1,774,682) (1,373,800) 505,991 889,462 Changes in Non-Cash Working Capital Accounts receivable (1,176,238) 733,185 Prepaid expenses 119,875 (487,300) Inventories for resale 68,760 153,392 Inventories held for use (34,331) 5,014 Accounts payable and accrued liabilities (1,328,252) 572,953 Deferred revenue 293,702 1,954,625 Employee future benefits 181,767 115,013 (1,874,717) 3,046,882 CASH FLOWS FROM (USED IN) CAPITAL ACTIVITIES Acquisition of tangible capital assets (12,706,154) (12,489,756) Deferred capital contributions received 14,358,186 6,994,631 1,652,032 (5,495,125) CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES Increase in portfolio investments, net (503,102) (336,496) Net Decrease in Cash and Cash Equivalents (219,796) (1,895,277) CASH AND CASH EQUIVALENTS, beginning of year 12,357,391 14,252,668 CASH AND CASH EQUIVALENTS, end of year $ 12,137,595 $ 12,357,391 The accompanying notes form an integral part of these consolidated financial statements 5 SELKIRK COLLEGE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS For the Year Ended March 31, 2019 1. Authority and Purpose Selkirk College (the College) is incorporated under the authority of the College and Institute Act of British Columbia. The College is a not-for-profit entity governed by a Board of Governors and is exempt from income tax under section 149 of the Income Tax Act.