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Sudbury Catholic District School Board

Management Report,Independent Auditor's Report andConsolidated Financial Statements

August 31, 2016

Management Report

Management’s Responsibility for the Consolidated Financial Statements

The accompanying consolidated financial statements of the Sudbury Catholic DistrictSchool Board are the responsibility of the Board’s management and have been preparedin accordance with the Financial Administration Act, supplemented by Ontario Ministryof Education memorandum 2004:B2 and Ontario Regulation 395/11 of the FinancialAdministration Act, as described in note 1 to the consolidated financial statements,except for the effect of adjustments, if any, which the auditors may have determined tobe necessary had they been able to obtain sufficient audit evidence to form an opinionwith respect to the completeness of school generated funds.

The preparation of consolidated financial statements necessarily involves the use ofestimates based on management’s judgment, particularly when transactions affecting thecurrent accounting period cannot be finalized with certainty until future periods.

The Board’s management maintains a system of internal controls designed to providereasonable assurance that assets are safeguarded, transactions are properly authorizedand recorded in compliance with legislative and regulatory requirements, and reliablefinancial information is available on a timely basis for preparation of the consolidatedfinancial statements. These systems are monitored and evaluated by management.

The Audit Committee of the Board meets with the external auditors to review theconsolidated financial statements and discuss any significant financial reporting orinternal control matters prior to the board’s approval of the consolidated financialstatements.

The consolidated financial statements have been audited by Collins Barrow SNT LLP,independent external auditors appointed by the Board. The accompanying IndependentAuditor’s Report outlines their responsibilities, the scope of their examination and theiropinion on the Board’s consolidated financial statements.

,,z Director ofducation Superintendent of Business and financeNovember/15, 2016

Independent Auditor's Report

To the Board of Trustees of theSudbury Catholic District School Board

We have audited the accompanying consolidated financial statements ofSudbury Catholic District School Board, which comprise the consolidated statement offinancial position as at August 31, 2016, the consolidated statements of operations andaccumulated surplus, cash flows and change in net debt for the year then ended, and asummary of significant accounting policies and other explanatory information.

Management's Responsibility for the Consolidated Financial Statements

Management is responsible for the preparation of these consolidated financial statements inaccordance with the Financial Administration Act, supplemented by Ontario Ministry ofEducation memorandum 2004:B2 and Ontario Regulation 395/11 of the FinancialAdministration Act, and for such internal control as management determines is necessary toenable the preparation of consolidated financial statements that are free from materialmisstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these consolidated financial statements basedon our audit. We conducted our audit in accordance with Canadian generally acceptedauditing standards. Those standards require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether the consolidatedfinancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the consolidated financial statements. The procedures selected depend on theauditor's judgement, including the assessment of the risks of material misstatement of theconsolidated financial statements, whether due to fraud or error. In making those riskassessments, we consider internal control relevant to the entity's preparation and fairpresentation of the consolidated financial statements in order to design audit procedures thatare appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the entity's internal control. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of accounting estimatesmade by management, as well as evaluating the overall presentation of the consolidatedfinancial statements.

We believe that the audit evidence that we have obtained is sufficient and appropriate toprovide a basis for our qualified audit opinion.

Les marques déposées de Collins Barrow sont utilisées en vertu d’une licence.Ce cabinet est la propriété et est géré de façon indépendante par Collins Barrow SNT s.r.l.

The Collins Barrow trademarks are used under License.This office is independently owned and operated by Collins Barrow SNT LLP.

Collins Barrow SNT LLP/s.r.l.1174 St. JeromeSudbury, OntarioP3A 2V9 Canada

705.560.5592705.560.8832

www.collinsbarrow.com

Independent Auditor's Report (Continued)

Basis for Qualified Opinion

In common with many school boards, individual schools derive revenue from schoolfund-raising activities held throughout the year, which, by their nature, are not susceptible tocomplete audit verification. Accordingly, our verification of these revenues was limited to theamounts recorded in the records of the individual schools and we were not able to determinewhether adjustments might be necessary to school fund-raising revenue, annual surplus, financialassets and accumulated surplus.

Qualified Opinion

In our opinion, except for the effects of the matter described in the Basis for Qualified Opinionparagraph, the consolidated financial statements of Sudbury Catholic District School Board as atand for the year ended August 31, 2016 are prepared, in all material respects, in accordance withthe Financial Administration Act, supplemented by Ontario Ministry of Education memorandum2004:B2 and Ontario Regulation 395/11 of the Financial Administration Act.

Emphasis of Matter

Without modifying our opinion, we draw attention to note 1 to the consolidated financialstatements which describes the basis of accounting used in the preparation of these consolidatedfinancial statements and the significant differences between such basis of accounting andCanadian public sector accounting standards.

Sudbury, Ontario CHARTERED PROFESSIONAL ACCOUNTANTS,November 15, 2016 LICENSED PUBLIC ACCOUNTANTS

Sudbury Catholic District School Board

Consolidated Financial StatementsAugust 31, 2016

Consolidated Statement of Financial Position 1

Consolidated Statement of Operations and Accumulated Surplus 2

Consolidated Statement of Cash Flows 3

Consolidated Statement of Change In Net Debt 4

Notes to the Consolidated Financial Statements 5-22

Sudbury Catholic District School BoardConsolidated Statement of Financial PositionAugust 31, 2016

2016 2015

Financial Assets

Cash $ 9,383,418 $ 8,999,593Accounts receivable (note 2) 3,449,014 4,501,332Accounts receivable - Government of Ontario

- approved capital (note 3) 34,071,006 40,774,29546,903,438 54,275,220

Financial Liabilities

Temporary borrowing (note 5) - 5,740,575Accounts payable and accrued liabilities (note 6) 5,628,212 8,634,185Net long-term debt (note 7) 31,709,267 32,813,404Deferred revenue (note 8) 4,843,736 5,566,057Deferred capital contributions (note 9) 80,102,357 72,622,053Retirement and other employee future benefits (note 10) 3,942.694 3,914,249

126,226,266 129,290,523

Net Debt (79,322,828) (75,015,303)

Non-Financial Assets

Prepaid expenses 210,150 879,813Tangible capital assets (note 12) 85,717.884 77,813.509

85,928,034 78.693,322

Accumulated Surplus (note 13) $ 6,605,206 $ 3,678,019

Contingent Liabilities (note 14)

Commitments (note 15)

Ap roved by the Board:

___________________________

Director of Education

__________________________

Chair of the Board

The accompanying notes are an integral part of these consolidated financial statements.

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Sudbury Catholic District School BoardConsolidated Statement of Operations and Accumulated Surplus For The Year Ended August 31, 2016

2016 2016 2015Budget Actual Actual

(Unaudited)

RevenuesLocal taxation $ 12,145,608 $ 12,483,225 $ 12,175,702Provincial grants - grants for student needs 63,476,124 64,251,524 64,362,139Provincial grants - other 1,511,253 2,549,970 2,463,097Federal grants and fees 558,546 539,348 526,020Other revenues - school boards - 74,019 40,970Other fees and revenues 567,500 1,038,797 1,079,433Investment income 96,000 78,332 102,166School fund-raising and other revenues 2,514,010 2,507,812 2,549,785Amortization of deferred capital contributions 4,584,529 4,130,679 4,789,334

85,453,570 87,653,706 88,088,646

ExpendituresInstruction 59,261,863 60,265,226 58,150,322Administration 4,104,425 4,115,125 4,144,128Transportation 5,820,773 5,786,262 5,818,890Pupil accommodation 12,646,314 12,113,663 12,645,443School funded activities 2,570,969 2,365,296 2,474,539Other - 80,947 199,770

84,404,344 84,726,519 83,433,092

Annual surplus 1,049,226 2,927,187 4,655,554

Accumulated Surplus (Deficit),Beginning of year 3,678,019 3,678,019 (977,535)

Accumulated Surplus, End of year $ 4,727,245 $ 6,605,206 $ 3,678,019


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Sudbury Catholic District School BoardConsolidated Statement of Cash Flows For The Year Ended August 31, 2016

2016 2015

OperationsAnnual surplus $ 2,927,187 $ 4,655,554

Cash provided by (used for):Non-cash items including amortization,

write-downs and loss (gain) on disposal 4,140,903 4,796,911Deferred capital contributions revenue (4,130,679) (4,789,334)Decrease (increase) in accounts receivable - other 1,052,318 (1,555,853)Increase (decrease) in accounts payable and

accrued liabilities (3,005,973) 2,491,938Increase (decrease) in deferred revenues (749,245) 560,420Increase (decrease) in retirement and other

employee future benefits 28,445 (641,877)Decrease in prepaid expenses 669,663 130,803

Cash provided by operating transactions 932,619 5,648,562

CapitalAcquisition of tangible capital assets (12,045,277) (18,561,568)

FinancingIncrease (decrease) in temporary borrowing (5,740,575) 3,673,472Net long-term debt repayments (1,104,138) (1,056,090)Decrease (increase) in accounts receivable -

Government of Ontario - Approved capital 6,703,289 (2,717,457)Additions to deferred capital contributions 11,610,983 17,029,078Increase (decrease) in deferred revenues 26,924 (2,511,361)

Cash provided by financing transactions 11,496,483 14,417,642

Increase in Cash 383,825 1,504,636

Cash, Beginning of Year 8,999,593 7,494,957

Cash, End of Year $ 9,383,418 $ 8,999,593


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Sudbury Catholic District School BoardConsolidated Statement of Change In Net Debt For The Year Ended August 31, 2016


(Unaudited)

Annual Surplus $ 1,049,226 $ 2,927,187 $ 4,655,554

Tangible Capital Asset ActivityAcquisition of tangible capital assets (3,838,656) (12,045,277) (18,561,568)Amortization of tangible capital assets 4,584,529 4,138,061 4,783,975Loss on sale of tangible capital assets - - 12,987Transfer to assets held for sale - 2,841 -

Total Tangible Capital Asset Activity 745,873 (7,904,375) (13,764,606)

Other Non-Financial Asset ActivityChange in prepaid expenses 669,663 669,663 130,803

Decrease (Increase) in Net Debt 2,464,762 (4,307,525) (8,978,249)

Net Debt, Beginning of Year (75,015,303) (75,015,303) (66,037,054)

Net Debt, End of Year $ (72,550,541) $ (79,322,828) $ (75,015,303)


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Sudbury Catholic District School BoardNotes to the Consolidated Financial Statements August 31, 2016

1. Significant Accounting Policies

The consolidated financial statements are prepared by management in accordance with thebasis of accounting described below.

(a) Basis of Accounting

These consolidated financial statements have been prepared in accordance with theFinancial Administration Act supplemented by Ontario Ministry of Educationmemorandum 2004:B2 and Ontario Regulation 395/11 of the Financial AdministrationAct.

The Financial Administration Act requires that the consolidated financial statements beprepared in accordance with the accounting principles determined by the relevantMinistry of the Province of Ontario. A directive was provided by the Ontario Ministryof Education within memorandum 2004:B2 requiring school boards to adopt Canadianpublic sector accounting standards commencing with their year ended August 31, 2004and that changes may be required to the application of these standards as a result ofregulation.

In 2011, the government passed Ontario Regulation 395/11 of the FinancialAdministration Act. The Regulation requires that contributions received or receivablefor the acquisition or development of depreciable tangible capital assets andcontributions of depreciable tangible capital assets for use in providing services, berecorded as deferred capital contributions and be recognized as revenue in the statementof operations over the periods during which the asset is used to provide service at thesame rate that amortization is recognized in respect of the related asset. The regulationfurther requires that if the net book value of the depreciable tangible capital asset isreduced for any reason other than depreciation, a proportionate reduction of thedeferred capital contribution along with a proportionate increase in the revenue berecognized. For Ontario school boards, these contributions include governmenttransfers, externally restricted contributions and, historically, property tax revenue.

The accounting policy requirements under Regulation 395/11 are significantly differentfrom the requirements of Canadian public sector accounting standards which requirethat:

government transfers, which do not contain a stipulation that creates a liability, berecognized as revenue by the recipient when approved by the transferor and theeligibility criteria have been met in accordance with Canadian public sectoraccounting standard PS3410;

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1. Significant Accounting Policies (Continued)

(a) Basis of Accounting (Continued)

externally restricted contributions be recognized as revenue in the period in whichthe resources are used for the purpose or purposes specified in accordance withCanadian public sector accounting standard PS3100; and

property taxation revenue be reported as revenue when received or receivable inaccordance with Canadian public sector accounting standard PS3510.

As a result, revenue recognized in the consolidated statement of operations andaccumulated surplus and certain related deferred revenues and deferred capitalcontributions would be recorded differently under Canadian Public Sector AccountingStandards.

(b) Reporting Entity

The consolidated financial statements reflect the assets, liabilities, revenues, andexpenditures of the reporting entity. The reporting entity is comprised of allorganizations accountable for the administration of their financial affairs and resourcesto the Board and which are controlled by the Board. The following entity is reflected inthe statements:

School generated funds, which include the assets, liabilities, revenues andexpenditures that exist at the school level and which are deemed to be controlled bythe Board, have been reflected in the consolidated financial statements.

Interdepartmental and inter-organizational transactions are eliminated in thisconsolidated financial statements.

(c) Trust Funds

Trust funds and their related operations administered by the Board are not included inthe consolidated financial statements as they are not controlled by the Board.

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(d) Deferred Revenue

Certain amounts are received pursuant to legislation, regulation or agreement and mayonly be used in the conduct of certain programs or in the delivery of specific servicesand transactions. These amounts are recognized as revenue in the fiscal year the relatedexpenditures are incurred or services performed.

(e) Deferred Capital Contributions

Contributions received or receivable for the purpose of acquiring or developing adepreciable tangible capital asset for use in providing services, or any contributions inthe form of depreciable tangible assets received or receivable for use in providingservices, shall be recognized as deferred capital contribution as defined in OntarioRegulation 395/11 of the Financial Administration Act. These amounts are recognizedas revenue at the same rate as the related tangible capital asset is amortized. Thefollowing items fall under this category:

Government transfers received or receivable for capital purpose;

Other restricted contributions received or receivable for capital purpose; and

Property taxation revenues which were historically used to fund capital assets.

(f) Retirement and Other Employee Future Benefits

The Board provides defined retirement and other future benefits to specified employeegroups. These benefits include pension, life insurance and health care benefits,retirement gratuity, workers' compensation and long-term disability benefits. The Boardhas adopted the following policies with respect to accounting for these employeebenefits:

(i) The costs of self-insured retirement and other employee future benefit plans areactuarially determined using management's best estimate of salary escalation,accumulated sick days at retirement, insurance and health care costs trends,disability recovery rates, long-term inflation rates and discount rates. The cost ofretirement gratuities are actuarially determined using the employee’s salary,banked sick days and years of service and management’s best estimate ofdiscount rates. Any actuarial gains and losses arising from changes to the discountrate are amortized over the expected average remaining service life of theemployee group.

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(f) Retirement and Other Employee Future Benefits (Continued)

For self-insured retirement and other employee future benefits that vest oraccumulate over the periods of service provided by employees, such as lifeinsurance and health care benefits for retirees, the cost is actuarially determinedusing the projected benefits method prorated on service. Under this method, thebenefit costs are recognized over the expected average service life of theemployee group.

For those self-insured benefit obligations that arise from specific events that occurfrom time to time, such as obligations for worker's compensation, long-termdisability and life insurance and health care benefits for those on disability leave,the cost is recognized immediately in the period the events occur. Any actuarialgains and losses that are related to these benefits are recognized immediately inthe period they arise.

(ii) The costs of multi-employer defined pension plan benefits, such as the OntarioMunicipal Employees Retirement System pensions, are the employer'scontributions due to the plan in the period.

(iii) The costs of insured benefits are the employer's portion of insurance premiumsowed for coverage of employees during the period.

(g) Non-Financial Assets

Non-financial assets are not available to discharge existing liabilities and are held foruse in the provision of services. They have useful lives extending beyond the currentyear and are not intended for sale in the ordinary course of operations.

(i) Tangible Capital Assets

Tangible capital assets are recorded at historical cost less accumulatedamortization. Historical cost includes amounts that are directly attributable toacquisition, construction, development or betterment of the asset, as well asinterest related to financing during construction. When historical cost recordswere not available, other methods were used to estimate the costs andaccumulated amortization.

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(g) Non-Financial Assets (Continued)

(i) Tangible Capital Assets (Continued)

Leases which transfer substantially all of the benefits and risks incidental toownership of property are accounted for as leased tangible capital assets. Allother leases are accounted for as operating leases and the related payments arecharged to expenses as incurred.

Tangible capital assets, except land, are amortized on a straight-line basis overtheir estimated useful lives as follows:

Asset Estimated Useful Life in Years

Land improvements 15Buildings 40First-time equipping of schools 10Furniture and equipment 5-15Vehicles 5-10Computer hardware 5Computer software 5

Assets under construction and assets that relate to pre-acquisition and pre-constructioncosts are not amortized until the asset is available for productive use.

Land permanently removed from service and held for resale is recorded at the lower ofcost and net realizable value. Cost includes amounts for improvements to prepare theland for sale or servicing. Building permanently removed from service and held forresale cease to be amortized and are recorded at the lower of carrying value andestimated net realizable value. Tangible capital assets which meet the criteria forfinancial assets are reclassified as "assets held for sale" on the Consolidated Statementof Financial Position.

Works of art and cultural and historic assets are not recorded as assets in theseconsolidated financial statements.

(ii) Prepaid Expenses

Prepaid expenses represent amounts paid in advance for a good or service not yetreceived. The expense is recognized once the goods have been received or theservices have been performed.

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(h) Government Transfers

Government transfers, which include legislative grants, are recognized in theconsolidated financial statements in the period in which events giving rise to thetransfer occur, providing the transfers are authorized, any eligibility criteria have beenmet and reasonable estimates of the amount can be made. If government transferscontain stipulations which give rise to a liability, they are deferred and recognized inrevenue when the stipulations are met.

Government transfers for capital are deferred as required by Regulation 395/11,recorded as deferred capital contributions (DCC) and recognized as revenue in theconsolidated statement of operations at the same rate and over the same periods as theasset is amortized.

(i) Legislative Grants

The legislative grants calculations are prepared annually by the Board and submitted tothe Ministry of Education for final approval. Adjustments, if any, are recorded in theyear in which they are made.

(j) Investment Income

Investment income is reported as revenue in the period earned.

When required by the funding government or related Act, investment income earned onexternally restricted funds such as pupil accommodation, education developmentcharges and special education forms part of the respective deferred revenue balances.

(k) Use of Estimates

The preparation of consolidated financial statements in conformity with the basis ofaccounting described in note 1(a) requires management to make estimates andassumptions that affect the reported amounts of assets and liabilities and disclosure ofcontingent assets and liabilities at the date of the consolidated financial statements, andthe reported amounts of revenues and expenditures during the year. Accounts subject tosignificant estimates include: historical cost of tangible capital assets, useful life oftangible capital assets and related amortization, accrued liabilities and employee futurebenefits. Actual results could differ from these estimates.

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(l) Budget Figures

Budget figures have been provided for comparison purposes and have been derivedfrom the budget approved by the Trustees. The budget approved by the Trustees isdeveloped in accordance with the provincially mandated funding model for schoolboards and is used to manage program spending within the guidelines of the fundingmodel. The budget figures are unaudited.

2. Accounts Receivable

2016 2015

Government of Canada $ 1,251,570 $ 1,995,151Government of Ontario 438,918 672,820Municipalities 1,576,475 1,468,039Other 182,051 365,322

$ 3,449,014 $ 4,501,332

3. Accounts Receivable - Government of Ontario - Approved Capital

The Province of Ontario replaced variable capital funding with a one-time debt support grant in2009-10. The Board received a one-time grant that recognizes capital debt as ofAugust 31, 2010 that is supported by the existing capital programs. The Board will receive thisgrant in cash over the remaining term of the existing capital debt instruments. The Board mayalso receive yearly capital grants to support capital programs which would be reflected in thisaccount receivable.

The Board has an account receivable from the Province of Ontario of $34,071,006 as atAugust 31, 2016 (2015 - $40,774,295) with respect to capital grants.

4. Assets Held for Sale

As of August 31, 2016, $ - (2015 - $ - ) related to buildings and $ -(2015 - $ - ) related to land were recorded as assets held for sale. During the year, threebuildings and two land properties were sold. Net proceeds of $2,645,605 (2015 - $ - ) werereceived on the sale of these properties, which had a carrying value of $3,000 (2015 - $ - ),resulting in a gain of $2,642,605 (2015 - $ - ). $2,642,605 of that gain was deferred forfuture capital asset purchases according to Ontario Regulation 193/10.

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5. Temporary Borrowing

The Board has an operating line of credit available to a maximum of $3,500,000 to addressoperating requirements. This line of credit bears interest at the bank's prime lending rate, isunsecured and is due on demand.

The Board has an authorized revolving term credit available to a maximum of $8,500,000 tobridge ongoing capital expenditures. This credit facility bears interest at the bank's primelending rate less 0.75%, is unsecured and matures March 2017.

As at August 31, 2016, the amount drawn from the operating line of credit was $ - (2015 -$ - ). The amount drawn from the revolving term credit was $ - (2015 - $5,740,575).

The Board has various letters of credit outstanding totalling $292,230 (2015 - $292,230).

6. Accounts Payable and Accrued Liabilities

2016 2015

Trade and accrued liabilities $ 4,221,902 $ 7,638,392Payroll related 1,406,310 995,793

$ 5,628,212 $ 8,634,185

7. Net Long-Term Debt

Net long-term debt reported on the Consolidated Statement of Financial Position comprises thefollowing:

2016 2015

Debentures - Amortizing, payable in semi-annualinstalments of $1,260,805 including interest atrates ranging from 3.56% to 5.80%, finalinstalment due between November 2028 andMarch 2038 $ 31,709,267 $ 32,813,404

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7. Net Long-Term Debt (Continued)

Principal and interest payments relating to net long-term debt of $31,709,267 outstanding as atAugust 31, 2016 are due as follows:

Principal Interest Total

2017 $ 1,154,444 $ 1,367,367 $ 2,521,8112018 1,207,118 1,314,493 2,521,6112019 1,262,275 1,259,336 2,521,6112020 1,320,036 1,201,575 2,521,6112021 1,380,528 1,140,965 2,521,493Thereafter 25,384,866 8,608,273 33,993,139

Net Long-Term Debt $ 31,709,267 $ 14,892,009 $ 46,601,276

8. Deferred Revenue

Revenues received and that have been set aside for specific purposes by legislation, regulationor agreement are included in deferred revenue and reported on the Consolidated Statement ofFinancial Position.

Deferred revenue set-aside for specific purposes by legislation, regulation or agreement as atAugust 31, 2016 is comprised of:

2016 2015

Internal audit $ 705,051 $ 757,725Proceeds of disposition 1,183,386 576,720Special education 1,923,192 2,301,061School renewal 764,115 434,747School Condition Improvement - 630,569Retrofitting school space for child care - 278,540Other 267,992 586,695

$ 4,843,736 $ 5,566,057

9. Deferred Capital Contributions

Deferred capital contributions include grants and contributions received that are used for theacquisition of tangible capital assets in accordance with regulation 395/11 that have beenexpended by year end. The contributions are amortized into revenue over the life of the assetacquired.

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9. Deferred Capital Contributions (Continued)

2016 2015

Balance, beginning of year $ 72,622,053 $ 60,382,309Additions to deferred capital contributions 11,610,983 17,029,078Revenue recognized in the period (4,130,679) (4,776,347)Disposals and write-downs - (12,987)

Balance, end of year $ 80,102,357 $ 72,622,053

10. Retirement and Other Employee Future Benefits

2016 2015Other Total Total

Retirement and Other Employee Employee EmployeeEmployee Future Benefit Retirement Future Future FutureLiabilities Benefits Benefits Benefits Benefits

Accrued employee futurebenefit obligations $ 1,296,130 $ 2,827,413 $ 4,123,543 $ 4,041,703

Unamortized actuarialgains/(losses) (180,849) - (180,849) (127,454)

Employee Future BenefitLiabilities $ 1,115,281 $ 2,827,413 $ 3,942,694 $ 3,914,249

2016 2015Other Total Total

Retirement and Other Employee Employee EmployeeEmployee Future Benefit Retirement Future Future FutureExpenses Benefits Benefits Benefits Benefits

Current year benefit cost $ 28,288 $ 72,890 $ 101,178 $ 129,224Interest on accrued

benefit obligation 33,691 56,739 90,430 119,039Recognized actuarial

(gains) losses 29,140 695,289 724,429 36,133Change due to voluntary

early payout (34,363) - (34,363) -

Employee Future BenefitExpenses 1 $ 56,756 $ 824,918 $ 881,674 $ 284,396

1 Excluding pension contributions to the Ontario Municipal Employees Retirement System, amulti-employer pension plan, described below.

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10. Retirement and Other Employee Future Benefits (Continued)

Retirement Benefits

(a) Ontario Teachers' Pension Plan

Teachers and related employee groups are eligible to be members of Ontario Teachers'Pension Plan. Employer contributions for these employees are provided directly by theProvince of Ontario. The pension costs and obligations related to this plan are a directresponsibility of the Province. Accordingly, no costs or liabilities related to this plan areincluded in the Board's consolidated financial statements.

(b) Ontario Municipal Employees Retirement System

All non-teaching employees of the Board are eligible to be members of the OntarioMunicipal Employees Retirement System (OMERS), a multi-employer pension plan.The plan provides defined pension benefits to employees based on their length ofservice and rates of pay. The Board contributions equal the employee contributions tothe plan. During the year ended August 31, 2016, the Board contributed $1,048,743(2015 - $1,032,953) to the plan. As this is a multi-employer pension plan, thesecontributions are the Board's pension benefit expenses. No pension liability for this typeof plan is included in the Board's consolidated financial statements.

On January 1, 2016, the yearly maximum pension earnings increased to $54,900 from$53,600 in 2015. The contributions are calculated at a rate of 9.0% (2015 - 9.0%) forthe amount up to the yearly maximum pension earnings stated above and at a rate of14.6% (2015 - 14.6%) for the amount above the yearly maximum pension earnings.

(c) Retirement Gratuities

The Board provides retirement gratuities to certain groups of employees hired prior tospecified dates. The Board provides these benefits through an unfunded defined benefitplan. The benefit costs and liabilities related to this plan are included in the Board’sconsolidated financial statements. The amount of the gratuities payable to eligibleemployees at retirement is based on their salary, accumulated sick days, and years ofservice at August 31, 2012.

1. Voluntary Retirement Gratuity Early Payout Provision

During 2015-16, OECTA and CUPE ratified agreements at the local and centrelevel, which included a voluntary retirement gratuity early payout provision. Theprovision provided OECTA and CUPE members the option of receiving adiscounted frozen retirement gratuity benefit payment by August 31, 2016 (or thefirst pay period in September 2016 for CUPE).

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Retirement Benefits (Continued)

(c) Retirement Gratuities (Continued)

1. Voluntary Retirement Gratuity Early Payout Provision (Continued)

The provision was also made available to all non-unionized school boardemployees, including principals and vice-principals.

Some employees took the early payouts, which were discounted from the currentfinancial statement carrying values. As a result, the reduction in the liability forthose members who took the early payout option was accompanied by actuarialgains or losses in the board's 2015-16 year financial statements.

(d) Retirement Life Insurance, Dental and Health Care Benefits

The Board continues to provide life insurance, dental and health care benefits to certainemployee groups after retirement until the members reach 65 years of age. Thepremiums are based on the Board experience and retirees’ premiums are subsidized bythe board. The benefit costs and liabilities related to the plan are provided through anunfunded defined benefit plan and are included in the Board’s consolidated financialstatements. Effective September 1, 2013, employees retiring on or after this date, nolonger qualify for board subsidized premiums or contributions.

Other Employee Future Benefits

(a) Workplace Safety and Insurance Board Obligations

The Board is a Schedule 2 employer under the Workplace Safety and Insurance Actand, as such, assumes responsibility for the payment of all claims to its injured workersunder the Act. The Board does not fund these obligations in advance of payments madeunder the Act. The benefit costs and liabilities related to this plan are included in theBoard's consolidated financial statements.

(b) Long-term Disability Benefits

The Board provides long-term disability benefits including partial salary compensationand payment of life insurance premiums and health care benefits during the period anemployee is unable to work or until their normal retirement date. The Board providesthese benefits through an unfunded defined benefit plan. The benefit costs and liabilitiesrelated to this plan are included in the Board's consolidated financial statements.

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Other Employee Future Benefits (Continued)

(c) Sick Leave Top-Up Benefits

A maximum of 11 unused sick leave days from the current year may be carried forwardinto the following year only, to be used to top-up salary for illnesses paid through theshort-term leave and disability plan in that year. The benefit costs expensed in theconsolidated financial statements are $42,717 (2015 - $20,867).

The accrued benefit obligation for the sick leave top-up is based on an actuarialvaluation for accounting purposes as of August 31, 2016. This actuarial valuation isbased on assumptions about future events determined as at August 31, 2016 and isbased on the average daily salary and banked sick days of employees as atAugust 31, 2016.

Actuarial Assumptions

The accrued benefit obligations for employee future benefit plans as at August 31, 2016 arebased on the most recent actuarial valuations completed for accounting purposes as atAugust 31, 2016. These valuations take into account the plan changes outlined above and theeconomic assumptions used in these valuations are the Board’s best estimates of expected ratesof:

2016 2015% %

Inflation 1.5 1.5Insurance and health care cost escalation 4.0 - 8.0 4.5 - 8.5Discount on accrued benefit obligations 2.05 2.45

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11. Benefit Plan Future Changes

Currently, the Board provides health, dental and life insurance benefits for certain employeesand retired individuals from school boards and has assumed liability for payment of benefitsunder these plans. As part of ratified labour collective agreements for unionized employees thatbargain centrally and ratified central discussions with the principals and vice-principalsassociations, Employee Life and Health Trusts (ELHTs) will be established in 2016-17 for thefollowing employee groups: OECTA and CUPE and non-unionized employees includingprincipals and vice-principals. The ELHTs will provide health, life and dental benefits toteachers (excluding daily occasional teachers), education workers (excluding casual andtemporary staff), other school board staff and retired individuals up to a school board’sparticipation date into the ELHT. These benefits will be provided through a joint governancestructure between the bargaining/employee groups, school board trustees associations and theGovernment of Ontario. Commencing February 1, 2017, the Board will phase out providingbenefits to the above mentioned groups. The Board will transfer to the ELHTs an amount perfull-time equivalency based on the 2014-15 actual benefit costs + 8.16% representinginflationary increases for 2015-16 and 2016-17. In addition, the Ministry of Education willprovide an additional $300 per FTE for active employees to the school board. These amountswill then be transferred to the Trust for the provision of employee and retiree benefits.

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12. Tangible Capital Assets

Cost Accumulated AmortizationDisposals, Disposals, Net Book Net Book

Balance at Write offs, Balance at Balance at Write offs, Balance at Value ValueAugust 31, Transfers and August 31, August 31, Transfers and August 31, August 31, August 31,

2015 Additions Adjustments 2016 2015 Amortization Adjustments 2016 2016 2015

Land $ 5,103,817 $ 434,705 $ (3,000) $ 5,535,522 $ - $ - $ - $ - $ 5,535,522 $ 5,103,817Land

improvements 945,053 350,263 307,421 1,602,737 292,096 84,933 - 377,029 1,225,708 652,957Buildings 89,877,946 4,025,842 8,267,582 102,171,370 36,060,456 3,438,033 (5,770,207) 33,728,282 68,443,088 53,817,490First time

equipping ofschools 679,959 377,941 - 1,057,900 159,612 67,174 - 226,786 831,114 520,347

Furniture andequipment 550,020 102,247 - 652,267 319,265 55,366 - 374,631 277,636 230,755

Vehicles 126,245 - - 126,245 126,245 - - 126,245 - -Computer

hardware 2,011,877 204,875 - 2,216,752 1,280,813 377,300 - 1,658,113 558,639 731,064Computer software 538,581 101,494 - 640,075 276,267 115,255 - 391,522 248,553 262,314Construction in

progress 16,494,765 6,447,910 (14,345,051) 8,597,624 - - - - 8,597,624 16,494,765Capital leased assets

- computer hardware 1,097,521 - - 1,097,521 1,097,521 - - 1,097,521 - -

Total $ 117,425,784 $ 12,045,277 $ (5,773,048) $ 123,698,013 $ 39,612,275 $ 4,138,061 $ (5,770,207) $ 37,980,129 $ 85,717,884 $ 77,813,509

Assets Under Construction

Assets under construction having a value of $8,597,624 (2015 - $16,494,765) have not been amortized. Amortization of these assets will commence when the asset is put intoservice.

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13. Accumulated Surplus

Accumulated surplus consists of the following:

2016 2015

Available for Compliance - UnappropriatedOperating Accumulated Surplus $ 3,361,800 $ 2,550,956

Available for Compliance - InternallyAppropriated

Reserve for system priorities 935,737 -

Unavailable for ComplianceEmployee future benefits (3,842,519) (4,434,445)Interest to be accrued (397,801) (412,261)School generated funds 995,668 853,152Revenues recognized for land 5,552,321 5,120,617

Total Unavailable for Compliance 2,307,669 1,127,063

Total Accumulated Surplus $ 6,605,206 $ 3,678,019

14. Contingent Liabilities

a) Statements of Claim

The Board along with other parties have been served with statements of claim. The Boardis of the opinion that the claims are unfounded and that some of the costs attributable tothese claims would be covered by insurance. Should any losses result from these claims,the amount would be charged to operations in the period in which the losses aredeterminable.

b) Subsidies

The Board receives subsidies and contributions from various funding agencies. Pursuantto the related agreements, if the Board does not meet established objectives, the fundingagencies could be entitled to seek refunds. Should any amounts become refundable, therefunds would be charged to operations in the period in which the refund is determined tobe payable.

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15. Commitments

The Board has entered into contracts for various projects. As at August 31, 2016, there wasapproximately $900,000 (2015 - $5,500,000) of work remaining to be completed.

16. Debt Charges

The expenditure for debt charges includes principal and interest payments as follows:

2016 2015

Principal payments on long-term debt $ 1,104,138 $ 1,056,090

Interest payments on long-term debt 1,417,471 1,514,607

$ 2,521,609 $ 2,570,697

17. Expenditures by Object

The following is a summary of the expenditures reported on the Consolidated Statement ofOperations and Accumulated Surplus by object:


(Unaudited)

ExpendituresSalary and wages $ 55,579,866 $ 54,972,659 $ 54,046,698Employee benefits 7,682,487 8,019,820 7,535,340Staff development 243,692 552,499 457,739Supplies and services 4,560,311 4,537,082 4,225,423Interest 1,567,473 1,516,858 1,514,607Rentals 55,000 44,443 43,712Fees and contract services 7,480,017 8,369,764 8,012,908Other 80,000 210,037 312,531Transfer to other boards - - 12,634Amortization of tangible capital assets 4,584,529 4,138,061 4,783,975Loss on disposal tangible capital assets - - 12,987

School Funded Activities 2,570,969 2,365,296 2,474,538

$ 84,404,344 $ 84,726,519 $ 83,433,092

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18. Ontario School Board Insurance Exchange (OSBIE)

The Board is a member of the Ontario School Board Insurance Exchange (OSBIE), a reciprocalinsurance company licensed under the Insurance Act. OSBIE insures general public liability,property damage and certain other risks.

Liability insurance is available to a maximum of $24,000,000 per occurrence.

The ultimate premiums over a five-year period are based on the reciprocal's and the Board'sactual claims experience. Periodically, the Board may receive a refund or be asked to pay anadditional premium based on its pro-rata share of claims experience. The current policy expiresDecember 31, 2016.

19. Transportation Consortium

The Board is a member of the Sudbury Student Services Consortium / Consortium de servicesaux élèves de Sudbury ("SSSC"). The SSSC provides student transportation services tostudents of the four local boards. The SSSC is a separate legal entity.

In the year, the Board paid $5,786,262 (2015 - $5,818,890) for student transportation servicesprovided by the SSSC. These amounts are included in transportation expenditure on theconsolidated statement of operations and accumulated surplus (deficit).

At year-end, the Board has a receivable of $30,722 (2015 - $785,124) from SSSC.

20. Comparative Figures

The presentation of certain accounts of the previous year has been changed to conform with thepresentation adopted for the current year.

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