County of Barrhead receives clear audit report

BARRHEAD - No skulduggery was in play when the County of Barrhead finance department prepared the municipality's 2023 financial statements.

That is according to Brad Lussier from Greilach Lussier LLP, the municipality's long-time auditor.

On April 2, Lussier told councillors that his firm had given the municipality a clean audit report.

However, the audit team did find an entry mistake, noting that the municipality inadvertently missed an accounts payable account of $29,500. 

Later in the meeting, in separate motions, councillors approved the audit and financial reports and authorized them to be posted on the municipality's website.

Lussier said, quoting from the statement of financial position, that the county's cash and temporary investments decreased by over $5.4 million, dropping to nearly $15 million from nearly $21 million.

"As much of the cash was deployed for projects," he said.

Lusier added that it is also important to remember that the statement of financial position is just "a snapshot in time"; in this case, the county's financial position as of Dec. 31, 2023.

Taxes and grants in place of taxes receivable also dropped by over $129,000, going from $744,000 in 2022 to $617,000 in 2023. 

Lussier said that is a good sign as it shows that more taxes in arrears are being paid.

He also noted that the significant decrease in trade and other receivables from $1.1 million to $644,000 was nothing to be concerned about, as the bulk of the difference was due to a delay in when the municipality received a grant for the Neerlandia lagoon upgrade project.

On the plus side, Lussier said the municipality saw a sizeable increase in investment income, jumping by over $200,000 to $3.8 million in 2023 from $3.6 million in 2022 due to the rise in interest rates.

When everything was accounted for in 2023, the municipality had $21 million in financial assets, a decrease of just under $6 million from $27 million in 2022. Again, Lussier reiterated that the difference is that the municipality cashed in some of its financial assets to complete capital projects.

On the liability side, in 2023, the county accrued $9.5 million, with the largest being $3.9 million in long-term debt, from what remains of the long-term debenture taken out in 2015 for its portion of the construction costs of the Barrhead Regional Aquatics Centre.

Lussier added in 2023, saw the creation of another category, the asset retirement obligation of $851,000.

"[The asset retirement obligation] includes the reclamation costs for [the county's] gravel pits in Vega and Fort Assiniboine, the [county's portion of the Barrhead Regional Landfill post-closure] and the asbestos in the administration building," he said, adding that this amount will be gradually increased until it reaches the estimated costs to retire those assets.

The value of non-financial assets increased, going from $54.9 million to $62.7 million. 

Lussier attributed the change to the increase in tangible capital assets, referring to the improvements of Range Road 22 south of Dunstable and Range Road 40.

The municipality's accumulated surplus, the total amount of assets less liabilities, also increased by over $7 million to $74 million in 2023 from $66.6 million in 2022.

On the revenue front, Lussier said that in 2023, as with every other year, most of the municipality's income came from property taxes, which were $9.6 million This was within $30,000 of what was budgeted and up roughly $470,000 from 2022.

He said the jump was due to the substantial increase in investment income, again due to higher-than-expected interest rates.

As for expenses, he said, in 2023, the municipality did much better than it initially anticipated, coming in at more than $2.8 million under what was initially budgeted at $13.3 million.

"[What had the largest impact] was the water and wastewater sanitary pre-treatment was deferred for another year," he said.

The installation of the component to the Town of Barrhead wastewater treatment lagoon was part of the sale condition for two lots at the county's Kiel Industrial Park by GFR Pharma, the owners of GFR Ingredients, a producer and supplier of plant-based proteins.

Barry Kerton, TownandCountryToday.com