Sample PSAB College Illustrative Financial Statements First Time Adopter

SAMPLE PSAB COLLEGE
ILLUSTRATIVE FINANCIAL STATEMENTS

FIRST-TIME ADOPTER
For the years ended March 31, 2013 and March 31, 2012
SAMPLE PSAB COLLEGE
Illustrative PSAB Financial Statements
The purpose of this publication is to assist colleges in preparing their first Public Sector Accounting
Standards (PSAB) financial statements for the year ended March 31, 2013.
In these financial statements, PS 2125 First-time Adoption by Government Organizations has been applied
in making the transition from pre-changeover Canadian GAAP to PSAB for Government NPOs. Please note
that PS 2125 allows a number of options upon transition. In addition, there are accounting choices
available in various areas that allow different accounting treatments (for example, deferral method
versus restricted fund method of accounting for contributions). Note that some accounting policies
chosen in these illustrative financial statements may be different than the ones you have chosen for your
college. The adoption of PSAB for Government NPOs will have the most significant impact on the
following areas of a colleges financial statements:
Financial Statement
Item Pre-changeover GAAP PSAB for Government NPOs
Non-vesting sick leave Not recognized as a liability. Recognized as a liability (see Note 2 to
liability financial statements).
Post-employment benefits The discount rate used to calculate the liability for The rate used must be either the colleges
and compensated absences employee future benefits is the market yield on cost of borrowing or the plan asset earnings
liabilities (formerly called high quality corporate bonds. (see Note 2 to the financial statements).
employee future benefits)
Financial instruments - Extensive requirements with financial instruments The changes under PSAB for Government
measurement being grouped into categories based on the nature NPOs and the new financial instrument
of the instrument as well as management's standard within PSAB (PS 3450) are extensive
accounting policy choices. and include a simplified approach to the
recognition and measurement of most
financial instruments. Financial instruments
are classified as either amortized cost or fair
value depending on the nature of the
instrument. There is also the introduction of
accumulated remeasurement gains and
losses where fluctuations in fair value for
derivatives and instruments measured at fair
value are recognized until ultimate
disposition of the instrument. See Note 3
and the Appendices for an in depth
discussion of these differences and their
effect.
Financial instruments - Limited disclosure requirements under Section Extensive disclosure requirements under PS
disclosures 3861. 3450. Disclosures include how colleges are
exposed to risks arising from their financial
instruments and how these risks are
mitigated, disclosure of the categorization
of financial instruments and the breakdown
of colleges' financial instruments by how
their fair value is measured. See Note 20 to
the financial statements and the
Appendices.
SAMPLE PSAB COLLEGE
Illustrative PSAB Financial Statements
These financial statements are based on the following assumptions about the example College:
- The College has chosen to adopt PSAB plus the 4200 series of standards applicable to government
not-for-profit organizations.
- The College classified its bond portfolio as held-to-maturity under pre-changeover Canadian GAAP
with bonds being measured at amortized cost using the effective interest rate method. Upon
adoption of PSAB for Government NPOs, the College chose to designate its bond portfolio to be
measured at fair value with fluctuations in fair value being recognized in the statement of
remeasurement gains/(losses). See the Appendices for further discussion of this election.
- The College classified its equities as held-for-trading under pre-changeover Canadian GAAP with
equities being measured at fair value with fluctuations being recorded in the statement of
operations. Upon adoption of PSAB for Government NPOs, equities are classified into the fair
value category as they are quoted in an active market and fluctuations in fair value are being
recognized in the statement of remeasurement gains/(losses).
- The College applied hedge accounting to its derivative financial instrument (an interest rate
swap) under pre-changeover Canadian GAAP. The derivative was recorded at fair value as an
asset/liability on the statement of financial position with fluctuations in fair value being recorded
directly to net assets in a separate unrestricted fund. Upon adoption of PS 3450 Financial
Instruments, the previously accumulated fair value adjustment is reclassified to accumulated
remeasurement gains/(losses).
- The Colleges tangible capital assets do not include any assets under capital lease.
- The College has selected its internal rate of borrowing to be its discount rate for retirement
benefit calculations (PSAB for government NPOs allows the rate of return on plan assets to be
used alternatively).
PS 2125 contains numerous optional exemptions upon the adoption of PSAB for Government NPOs. For the
purpose of this publication, these illustrative financial statements have taken the exemptions having the
most relevance to colleges under normal circumstances. Users are cautioned that they must consider their
own particular circumstances in making choices under PS 2125 as each college may have circumstances and
transactions not contemplated in the preparation of this publication. The optional exemptions taken are
described in Note 2 and explained in Appendices topic #7.
Certain explanatory details and discussions of possible alternative accounting treatments or explanatory
information are beyond the scope of the body of the financial statements and thus have been included in
appendices to the financial statements. Where financial statement treatments and items require further
explanation, a superscript titled App. #1, #2, #3, etc. has been included to the right of the relevant
item.
The publication is based on standards that have been issued by the Public Sector Accounting Board (PSAB)
by January 1, 2012. These sample financial statements should not be used as a substitute for referring to
standards and interpretations themselves.
This publication has been carefully prepared, but it has been written in general terms and should be seen
as broad guidance only. The publication cannot be relied upon to cover specific situations and you should
not act, or refrain from acting, upon the information contained therein without obtaining specific
professional advice. Please contact BDO Canada LLP to discuss these matters in the context of your
particular circumstances. BDO Canada LLP, its partners, employees and agents do not accept or assume
any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance
on the information in this publication or for any decision based on it.
BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK
company limited by guarantee, and forms part of the international BDO network of independent member
firms. BDO is the brand name for the BDO network and for each of the BDO Member Firms.
SAMPLE PSAB COLLEGE
Statement of Financial Position
March 31, 2013 March 31, 2012 April 1, 2011
ASSETS
CURRENT ASSETS
Cash $ 33,068,000 $ 15,140,000 $ 1,575,000
Accounts receivable (Note 20) 16,537,500 15,750,000 15,000,000
Temporary investments (Note 4) 4,300,000 4,200,000 4,000,000
Inventory 110,250 105,000 100,000
Prepaid expenses 3,638,250 3,465,000 3,300,000
57,654,000 38,660,000 23,975,000
App. #1
INTEREST IN SAMPLE PSAB CULINARY JOINT VENTURE (Note 5) 2,500,000 2,350,000 2,225,000
LONG-TERM INVESTMENTS (Note 4) 54,000,000 51,750,000 50,000,000
LONG-TERM RECEIVABLE (Note 6) 6,300,000 7,300,000 9,400,000
CONSTRUCTION IN PROGRESS (Note 7) 61,100,000 60,500,000 58,000,000
CAPITAL ASSETS (Note 8) 160,398,500 152,870,000 145,700,000
$ 341,952,500 $ 313,430,000 $ 289,300,000
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 37,485,000 $ 35,700,000 $ 34,000,000

Deferred revenue (Note 9) 33,846,750 32,235,000 30,700,000
Vacation pay 9,150,750 8,715,000 8,300,000
Bank loans (Note 10) 2,600,000 2,800,000 3,000,000
Term debt (Note 11) 18,300,000 18,700,000 19,200,000
101,382,500 98,150,000 95,200,000
POST-EMPLOYMENT BENEFITS AND COMPENSATED ABSENCES (Note 12) (a) 6,407,500 5,840,000 4,910,000
DEFERRED CONTRIBUTIONS (Note 13) 2,100,000 2,000,000 1,900,000
DEFERRED CAPITAL CONTRIBUTIONS (Note 14) 73,500,000 74,000,000 74,800,000
DEFERRED CAPITAL CONTRIBUTIONS RELATING
TO CONSTRUCTION IN PROGRESS (Note 15) 55,500,000 56,000,000 56,200,000
INTEREST RATE SWAP (Note 11) 1,900,000 2,100,000 2,400,000
240,790,000 238,090,000 235,410,000
NET ASSETS
Unrestricted
Operating 42,499,500 21,195,000 1,700,000
Post-employment benefits and compensated absences (6,407,500) (5,840,000) (4,910,000)
Vacation pay (9,150,750) (8,715,000) (8,300,000)
Interest rate swap (Note 11) - (2,100,000) (2,400,000)
26,941,250 4,540,000 (13,910,000)
INVESTED IN CAPITAL ASSETS (Note 16) 60,086,250 57,225,000 54,500,000

INTERNALLY RESTRICTED (Note 17) 855,000 825,000 800,000
EXTERNALLY RESTRICTED (Note 18) 12,865,000 12,750,000 12,500,000
100,747,500 75,340,000 53,890,000
ACCUMULATED REMEASUREMENT GAINS 415,000 - -

101,162,500 75,340,000 53,890,000
$ 341,952,500 $ 313,430,000 $ 289,300,000
- - -
(a) Note that these liabilities were typically described as "employee future benefits" in college's pre-changeover GAAP financial statements.
The terminology used in these example financial statements is the technical definition provided by the relevant sections in PSAB, which
describe the relevant liabilities as post-employment and compensated absences liabilities.
The accompanying notes are an integral part of these financial statements Page 1 of 35
SAMPLE PSAB COLLEGE
Statement of Operations
For the years ended March 31, 2013 March 31, 2012
REVENUE
Grants and reimbursements $ 105,600,000 $ 100,600,000

Tuition revenue 101,300,000 96,500,000
Contract training 8,000,000 7,600,000
Amortization of deferred capital contributions 5,600,000 5,300,000
App. #2
Realized gains on sale of temporary investments 42,500 -
Interest income 1,500,000 1,400,000
Other income 10,100,000 9,600,000
App. #1
Share of income of joint venture (Note 5) 150,000 125,000
Ancillary operations 7,900,000 7,500,000
240,192,500 228,625,000
EXPENSES
Salaries and benefits 139,400,000 133,725,000

Operating expenses 42,600,000 40,600,000
Plant and property maintenance 11,100,000 10,600,000
Amortization of capital assets 13,200,000 12,600,000
Bursaries and scholarships 4,300,000 4,100,000
Ancillary operations 6,400,000 6,100,000
217,000,000 207,725,000
EXCESS OF REVENUE OVER EXPENSES FOR THE YEAR $ 23,192,500 $ 20,900,000
SAMPLE PSAB COLLEGE
Statement of Changes in Net Assets
March 31, 2013
Unrestricted Capital Restricted

Internally Externally
Restricted Restricted
(Note 17) (Note 18) (Note 19) Total
BALANCE, BEGINNING OF YEAR $ 4,540,000 $ 57,225,000 $ 825,000 $ 12,750,000 $ 75,340,000
RECLASSIFICATION OF UNREALIZED
LOSSES ON DERIVATIVE DUE TO
ADOPTION OF PS 3450 (NOTE 3) 2,100,000 - - - 2,100,000
ENDOWMENTS RECEIVED
DURING THE YEAR - - - 115,000 115,000
INTERNALLY RESTRICTED
SCHOLARSHIPS & BURSARIES (30,000) - 30,000 - -
EXCESS (DEFICIENCY) OF REVENUES

OVER EXPENSES 30,792,500 (7,600,000) - - 23,192,500
INVESTMENT IN CAPITAL ASSETS (10,461,250) 10,461,250 - - -
BALANCE, END OF YEAR $ 26,941,250 $ 60,086,250 $ 855,000 $ 12,865,000 $ 100,747,500
March 31, 2012
Unrestricted Capital Restricted

Internally Externally
Restricted Restricted
(Note 17) (Note 18) (Note 19) Total
BALANCE, BEGINNING OF YEAR $ (13,910,000) $ 54,500,000 $ 800,000 $ 12,500,000 $ 53,890,000
ENDOWMENTS RECEIVED
DURING THE YEAR - - - 250,000 250,000
INTERNALLY RESTRICTED
SCHOLARSHIPS & BURSARIES (25,000) - 25,000 - -
EXCESS (DEFICIENCY) OF REVENUES

OVER EXPENSES 28,200,000 (7,300,000) - - 20,900,000
CHANGE IN FAIR VALUE OF

INTEREST RATE SWAP 300,000 - - - 300,000
INVESTMENT IN CAPITAL ASSETS (10,025,000) 10,025,000 - - -
BALANCE, END OF YEAR $ 4,540,000 $ 57,225,000 $ 825,000 $ 12,750,000 $ 75,340,000
SAMPLE PSAB COLLEGE
Statement of Cash Flows
March 31, 2013 March 31, 2012
NET INFLOW (OUTFLOW) OF CASH RELATED

TO THE FOLLOWING ACTIVITIES
OPERATING
Excess of revenue over expenditure $ 23,192,500 $ 20,900,000
Items not involving cash:
App. #2
Realized gains on sale of temporary investments (42,500) -
Share of income of joint venture (Note 5) (150,000) (125,000)
Amortization of capital assets 13,200,000 12,600,000
Amortization of deferred capital contributions (5,600,000) (5,300,000)
Deferred contributions recognized as revenue in the year (1,650,000) (1,700,000)
28,950,000 26,375,000
Accrual for post-employment benefits and compensated absences 567,500 930,000
Changes in non-cash working capital items:

Accounts receivable (787,500) (750,000)
Inventory (5,250) (5,000)
Prepaid expenses (173,250) (165,000)
Accounts payable and accrued liabilities 1,785,000 1,700,000
Accrual for vacation pay 435,750 415,000
Deferred revenue 1,611,750 1,535,000
32,384,000 30,035,000
FINANCING
Deferred contributions 1,750,000 1,800,000
Repayment of bank loans (200,000) (200,000)
Repayment of term debt (400,000) (500,000)
Endowment contributions 115,000 250,000
1,265,000 1,350,000
App. #8
CAPITAL
Contributions received for capital purposes 4,000,000 2,500,000
Contributions received for construction in progress 600,000 1,800,000
Construction in progress (1,700,000) (4,500,000)
Purchase of capital assets (19,628,500) (17,770,000)
(16,728,500) (17,970,000)
INVESTING
Long-term receivable 1,000,000 2,100,000
Purchase of long-term investments - (1,750,000)
Purchase of temporary investments (185,000) (200,000)
Proceeds on sale of temporary investments 192,500 -
1,007,500 150,000
NET CASH INFLOW 17,928,000 13,565,000
CASH, BEGINNING OF YEAR 15,140,000 1,575,000

CASH, END OF YEAR $ 33,068,000 $ 15,140,000
Supplemental disclosure
INTEREST PAID $ 1,550,000 $ 1,425,000
INTEREST RECEIVED $ 850,000 $ 725,000
SAMPLE PSAB COLLEGE
Statement of Remeasurement Gains and Losses
March 31, 2013 March 31, 2012
Accumulated remeasurement losses at beginning of year $ - $ -

App. #3
Adjustment upon adoption of financial instruments section (Note 3) (a) (100,000) -
Unrealized gains attributable to:
Temporary investments 100,000 -
Long-term investments 257,500 -
Derivative - interest rate swap 200,000 -
Amounts reclassified to the statement of operations:
App. #2
Disposition of long-term investments (42,500) -
Net remeasurement gains for the year 415,000 -
Accumulated remeasurement gains at end of year $ 415,000 $ -
(a) The adjustment to opening accumulated remeasurement gains/(losses) relates to:
Increase due to classifying bond portfolio in the FV category 2,000,000

Decrease due to reclassification of fair value of interest rate swap (2,100,000)
Net decrease upon adoption of PSAB (100,000)
See Note 3 to the example financial statements for a detailed explanation of these adjustments.
SAMPLE PSAB COLLEGE
Notes to the Financial Statements
1. SIGNIFICANT ACCOUNTING POLICIES
Description of Sample PSAB College, established in 1967, is an Ontario college of

Organization applied arts and technology duly established pursuant to Ontario
regulation 34/03 made under the Ontario Colleges of Applied Arts
and Technology Act, 2002. The College is an agency of the Crown
and provides postsecondary, vocationally oriented education in
the areas of applied arts, business, health sciences and
technology.
The College is a not-for-profit organization and, as such, is

exempt from income taxes under the Income Tax Act (Canada).
Basis of presentation The financial statements of the College have been prepared in
accordance with Canadian public sector accounting standards for
government not-for-profit organizations, including the 4200 series
of standards, as issued by the Public Sector Accounting Board
(PSAB for Government NPOs).
Revenue recognition The College follows the deferral method of accounting for
contributions, which include donations and government grants.
Tuition fees and contract training revenues are recognized as
income to the extent that the related courses and services are
provided within the fiscal year of the College.
Ancillary revenues including parking, bookstore, residence and

other sundry revenues are recognized when products are
delivered or services are provided to the student or client, the
sales price is fixed and determinable, and collection is reasonably
assured.
Unrestricted contributions are recognized as revenue when

received or receivable.
Externally restricted contributions and restricted investment

income are recognized as revenue in the year in which the related
expenses are incurred.
Restricted contributions for the purchase of capital assets are

deferred and amortized into revenue at a rate corresponding with
the amortization rate for the related capital assets.
Endowment contributions are recognized as direct increases in

endowed net assets.
Restricted investment income is recognized as revenue in the year

in which the related expenses are incurred. Restricted investment
income that must be maintained as an endowment is credited to
net assets. Unrestricted investment income is recognized as
revenue when earned.
Page 6 of 35
SAMPLE PSAB COLLEGE
1. SIGNIFICANT ACCOUNTING POLICIES (continued)
Inventory Inventories are valued at the lower of cost and net realizable
value. Cost is determined on the first-in first-out basis.
Capital assets Purchased capital assets are recorded at cost less accumulated
amortization. Contributed capital assets are recorded at fair
value at the date of contribution. Repairs and maintenance costs
are charged to expense. Betterments that extend the estimated
life of an asset are capitalized. When a capital asset no longer
contributes to the Colleges ability to provide services or the
value of future economic benefits associated with the capital
asset is less than its net book value, the carrying value of the
capital asset is reduced to reflect the decline in the assets value.
Construction in progress is not recorded as a capital asset, or

amortized until construction it is put into service.
Capital assets are capitalized on acquisition and amortized on a

straight-line basis over their useful lives, which has been
estimated to be as follows:
Buildings & building improvements - 20 to 40 years

Building-student residence - 20 years
Large machinery - 20 years
Leasehold improvements - 5 years
Computer software - 5 years
Furniture, equipment and computers - 5 years
Vacation pay The College recognizes vacation pay as an expense on the accrual
basis.
Retirement and The College provides defined retirement and post-employment

post-employment benefits and compensated absences to certain employee groups.
benefits and These benefits include pension, health and dental, vesting sick
compensated leave and non-vesting sick leave. The College has adopted the
absences following policies with respect to accounting for these employee
benefits:
(i) The costs of post-employment future benefits are

actuarially determined using managements best estimate
of health care costs, disability recovery rates and discount
rates. Adjustments to these costs arising from changes in
estimates and experience gains and losses are amortized
to income over the estimated average remaining service
life of the employee groups on a straight line basis
(ii) The costs of the multi-employer defined benefit pension

are the employers contributions due to the plan in the
period.
Page 7 of 35
SAMPLE PSAB COLLEGE
Retirement and (iii) The cost of vesting and non-vesting sick leave benefits are
post-employment actuarially determined using managements best estimate
benefits and of salary escalation, employees use of entitlement and
compensated discount rates. Adjustments to these costs arising from
absences changes in actuarial assumption and/or experience are
(continued) recognized over the estimated average remaining service
life of the employees.
(iv) The discount used in the determination of the above-

mentioned liabilities is equal to the Colleges internal rate
of borrowing.
Interest in Joint The interest in the joint venture is accounted for using the
Venture modified equity method wherein the interest in the joint venture
is equal to the Colleges 50% share of the net assets. No
adjustment is made for the basis of accounting of the joint
venture being different than PSAB for Government NPOs.
Financial The College classifies its financial instruments as either fair value
instruments or amortized cost. The Colleges accounting policy for each
category is as follows:
Fair value
This category includes derivatives and equity instruments quoted
in an active market. The College has designated its bond portfolio
that would otherwise be classified into the amortized cost
category at fair value as the College manages and reports
performance of it on a fair value basis.
They are initially recognized at cost and subsequently carried at

fair value. Unrealized changes in fair value are recognized in the
statement of remeasurement gains and losses until they are
realized, when they are transferred to the statement of
operations.
Transaction costs related to financial instruments in the fair value

category are expensed as incurred.
Where a decline in fair value is determined to be other than

temporary, the amount of the loss is removed from accumulated
remeasurement gains and losses and recognized in the statement
of operations. On sale, the amount held in accumulated
remeasurement gains and losses associated with that instrument
is removed from net assets and recognized in the statement of
operations.
Page 8 of 35
SAMPLE PSAB COLLEGE
Financial
instruments
Amortized cost
(continued)
This category includes accounts receivable, long-term receivable,
accounts payable and accrued liabilities, bank loans and term
debt. They are initially recognized at cost and subsequently
carried at amortized cost using the effective interest rate
method, less any impairment losses on financial assets.
Transaction costs related to financial instruments in the

amortized cost category are added to the carrying value of the
instrument.
Writedowns on financial assets in the amortized cost category are

recognized when the amount of a loss is known with sufficient
precision, and there is no realistic prospect of recovery. Financial
assets are then written down to net recoverable value with the
writedown being recognized in the statement of operations.
Management The preparation of financial statements in conformity with PSAB

estimates for Government NPOs requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities, the disclosure of contingent assets and liabilities at the
date of the financial statements, and the reported amounts of
revenue and expenses during the period. Actual results could
differ from these estimates. Areas of key estimation include
determination of fair value for long-term investments, allowance
for doubtful accounts, and actuarial estimation of post-
employment benefits and compensated absences liabilities.
Page 9 of 35
SAMPLE PSAB COLLEGE
2. FIRST TIME ADOPTION OF PUBLIC SECTOR ACCOUNTING STANDARDS
The Public Sector Accounting Board (PSAB) issued new standards for government (public sector) not-for-
profit organizations. For years beginning on or after January 1, 2012, government NPOs have a choice of:
1. Public sector accounting standards including PS 4200 4270 for government not-for-profit
organizations; or
2. Public sector accounting standards
The College has chosen to follow Public Sector Accounting standards including PS 4200 4270 for
government not-for-profit organizations.
Effective April 1, 2012, the College adopted the requirements of the new accounting framework,
Canadian Public Sector Accounting Standards for Not-for-Profit Organizations (PSAB for Government
NPOs). These are the Colleges first financial statements prepared in accordance with this framework
and the transitional provisions of Section 2125, First-time Adoption by Government Organizations have
been applied. Section 2125 requires retroactive application App. #8 of the accounting standards with
certain elective exemptions and mandatory exceptions. The accounting policies set out in the Summary
of Significant Accounting Policies have been applied in preparing the financial statements for the year
ended March 31, 2013, the comparative information presented in these financial statements for the year
ended March 31, 2012 and in the preparation of an opening PSAB for Government NPOs balance sheet at
the date of transition of April 1, 2011 with the exception of PS 2601 Foreign Currency Translation and
PS 3450 Financial Instruments, which has been applied with an effective date of April 1, 2012 (see Note
3 Change in Accounting Policy).
The College issued financial statements for the year ended March 31, 2011 using generally accepted
accounting principles prescribed by the CICA Handbook Accounting Part V - Pre-changeover Accounting
Standards. The adoption of PSAB for Government NPOs resulted in adjustments to the previously
reported assets, liabilities, net assets, excess of revenue over expenses and cash flows of the College. An
explanation of how the transition from pre-changeover Canadian GAAP to PSAB for Government NPOs has
affected the Colleges financial position, operations, changes in net assets and cash flows is set out in
the following notes and tables.
The following exemptions and exceptions were used at the date of transition to Canadian accounting
standards for not-for-profit organizations:
App. #7
Optional exemptions
Actuarial Gains and Losses
Pre-changeover GAAP allowed the College to only recognize actuarial gains and losses that exceeded
certain prescribed amounts (the corridor approach). PSAB for Government NPOs requires the
amortization of actuarial gains and losses on post-employment benefit obligations and compensated
absences to be amortized over the estimated average remaining service life of employees. Retroactive
application of this approach would require the College to split the cumulative actuarial gains and losses
from the inception of the plan until the date of transition to PSAB for Government NPOs into a
recognized portion and an unrecognized portion. The College has elected to recognize all cumulative
actuarial gains and losses as the date of transition to PSAB for Government NPOs directly in net assets.
Actuarial gains and losses subsequent to the date of transition to PSAB for Government NPOs are
accounted for in accordance with PS 3250 Retirement Benefits.
Page 10 of 35
SAMPLE PSAB COLLEGE
2. FIRST TIME ADOPTION OF PUBLIC SECTOR ACCOUNTING STANDARDS (continued)

Business combinations
The College elected to not retroactively apply the provisions PS 2510 Additional Areas of Consolidation
to periods prior to the date of transition to PSAB for Government NPOs. As such, assets, liabilities and
net assets have not been restated that may have been required if the provisions of PS 2510 had been
applied retroactively.
Mandatory exceptions
Estimates
The estimates previously made by the College under pre-changeover Canadian GAAP were not revised for
the application of PSAB for Government NPOs except where necessary to reflect any difference in
accounting policy or where there was objective evidence that those estimates were in error. As a result
the College has not used hindsight to revise estimates.
Reconciliation of net assets and excess of revenue over expenses

In preparing these financial statements, management has amended certain accounting policies previously
applied in the pre-changeover Canadian GAAP financial statements to comply with PSAB for Government
NPOs. The comparative figures for March 31, 2012 were restated to reflect these adjustments. The
following reconciliations and explanatory notes provide a description of the effect of the transition from
pre-changeover Canadian GAAP to PSAB for Government NPOs on net assets and excess of revenues over
expenses:
Page 11 of 35
SAMPLE PSAB COLLEGE
Statement of Financial Position as at April 1, 2011 Transition Date
Transitional Adjustments
PSAB for
Pre-changeover Government
Canadian GAAP Adj. (i) Adj. (ii) Adj. (iii) NPOs
Liabilities
Post-employment benefits and
compensated absences
Vesting sick leave $ 900,000 $ - $ 120,000 $ 180,000 $ 1,200,000
Non-vesting sick leave - 2,300,000 - - 2,300,000
Retirement benefits 1,300,000 - 20,000 90,000 1,410,000
$ 2,200,000 $ 2,300,000 $ 140,000 $ 270,000 $ 4,910,000
Net Assets
compensated absences $ (2,200,000) $ (2,300,000) $ (140,000) $ (270,000) $ (4,910,000)
Statement of Financial Position for the year-ended March 31, 2012
Transitional Adjustments
PSAB for
Canadian GAAP Adj. (i) Adj. (ii) Adj. (iii) NPOs
Liabilities
compensated absences
Vesting sick leave $ 775,000 $ - $ 110,000 $ 215,000 $ 1,100,000
Non-vesting sick leave - 3,300,000 - - 3,300,000
Retirement benefits 1,325,000 - 15,000 100,000 1,440,000
$ 2,100,000 $ 3,300,000 $ 125,000 $ 315,000 $ 5,840,000
Net Assets
compensated absences $ (2,100,000) $ (3,300,000) $ (125,000) $ (315,000) $ (5,840,000)
Page 12 of 35
SAMPLE PSAB COLLEGE
Statement of Operations for the year-ended March 31, 2012

PSAB for
Sub-note Canadian GAAP Adjustments NPOs
Expenses App. #4
Salaries and benefits (i), (ii), (iii) $ 132,685,000 $ 1,040,000 $ 133,725,000
Excess of revenue over

expenses (i), (ii), (iii) $ 21,940,000 $ (1,040,000) $ 20,900,000
Statement of Cash Flows for the year-ended March 31, 2012
The transition to PSAB for Government NPOs had no impact on total operating or financing activities on
the statement of cash flows. The change in excess of revenues over expenses for year-ended March 31,
2012 has been offset by adjustments to operating activities. The transition to PSAB for Government
NPOs resulted in the reclassification of cash receipts and outflows relating to the acquisition of
tangible capital assets from investing activities to capital activities. The capital section of the
statement of cash flows did not exist prior to the transition to PSAB for Government NPOs.
App. #4
Explanations for Adjustments to PSAB for Government NPOs
(i) Non-vesting Sick Leave
PSAB for Government NPOs requires the recognition of a liability for sick leave benefits that
accumulate, but do not vest, which was not required under pre-changeover GAAP. As a result, the
College has recognized a liability and charge to net assets as described in the tables above.
(ii) Amortization of Actuarial Gains/Losses
As discussed in Note 2 First Time Adoption of Public Sector Accounting Standards, Optional
Exemptions, the College has elected to recognize actuarial gains and losses at the date of
transition to PSAB for Government NPOs directly in net assets. As a result, the College has
recognized an increased liability and a charge to net assets as described in the tables above.
(iii) Discount Rate Used to Calculate Post-Employment Benefits and Compensated Absences Liabilities
PSAB for Government NPOs requires these liabilities to be calculated with a discount rate that is
equal to either the Colleges rate of borrowing or the rate of return on the plan assets. Pre-
changeover GAAP required the discount rate to be equal to the yield on high quality corporate
bonds. The College has chosen to discount these liabilities using its internal rate of borrowing. The
change in the discount rate resulted in changes to the related liabilities and charges to net income
as described in the tables above.
Page 13 of 35
SAMPLE PSAB COLLEGE
App #3
3. CHANGE IN ACCOUNTING POLICY
On April 1, 2012, the College adopted Public Accounting Standards PS 3450 - Financial Instruments and
PS 2601 Foreign Currency Translation. The standards were adopted prospectively from the date of
adoption. The new standards provide comprehensive requirements for the recognition, measurement,
presentation and disclosure of financial instruments and foreign currency transactions.
Under PS 3450, all financial instruments, including derivatives, are included on the statement of
financial position and are measured either at fair value or amortized cost based on the characteristics
of the instrument and the Colleges accounting policy choices (see Note 1 Significant Accounting
Policies).
In accordance with the provisions of this new standard, the College reflected the following
adjustments:
- April 1, 2012: an increase of $2,000,000 to long-term investments and an increase of $2,000,000 to

accumulated remeasurement gains/(losses) due to the College choosing to designate its bond
portfolio at fair value upon initial adoption of the standard whereas it was originally classified as
held to maturity under pre-changeover GAAP.
- April 1, 2012: an increase of $2,100,000 to unrestricted net assets and a decrease of $2,100,000 to
accumulated remeasurement gains/(losses) due to the fair value of the Colleges interest rate
swap derivative being reclassified to accumulated remeasurement gains/(losses).
App #6
4. FINANCIAL INSTRUMENT CLASSIFICATION
The following table provides cost and fair value information of financial instruments by category. The
maximum exposure to credit risk would be the carrying value as shown below.
2013
Fair Value Amortized Cost Total
Cash $ 33,068,000 $ - $ 33,068,000
Accounts receivable - 16,537,500 16,537,500
Temporary investments 4,300,000 - 4,300,000
Long-term investments 54,000,000 - 54,000,000
Long-term receivable - 6,300,000 6,300,000
Accounts payable and accrued liab. - 37,485,000 37,485,000
Interest rate swap 2,100,000 - 2,100,000
$ 93,468,000 $ 60,322,500 $ 153,790,500
Temporary investments consist of equity instruments in Canadian public companies and long-term
investments consist of government of Canada bonds. Long-term investments include $12,900,000
(2011 - $12,798,000) of investments externally restricted for endowment purposes (see Note 18).
Page 14 of 35
SAMPLE PSAB COLLEGE
4. FINANCIAL INSTRUMENT CLASSIFICATION (continued)

Maturity profile of bonds held is as follows:
2013
Within 2 to 5 6 to 10 Over 10
1 year years years years Total
Carrying value $ - $ 11,450,000 $ 25,000,000 $ 17,550,000 $ 54,000,000
Percent of Total 0% 21% 46% 33%
The following table provides an analysis of financial instruments that are measured subsequent to
initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which the fair value
is observable:
- Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active
markets for identical assets or liabilities using the last bid price;
- Level 2 fair value measurements are those derived from inputs other than quoted prices included
within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices); and
- Level 3 fair value measurements are those derived from valuation techniques that include inputs for
the asset or liability that are not based on observable market data (unobservable inputs).
2013
Level 1 Level 2 Level 3 Total
Cash $ 33,068,000 $ - $ - $ 33,068,000
Temporary investments 4,300,000 - - 4,300,000
Long-term investments - 54,000,000 - 54,000,000
Interest rate swap - - 2,100,000 2,100,000
Total $ 37,368,000 $ 54,000,000 $ 2,100,000 $ 93,468,000
There were no transfers between Level 1 and Level 2 for the years ended March 31, 2013 and 2012.
There were also no transfers in or out of Level 3. For a sensitivity analysis of financial instruments
recognized in Level 3, see Note 20 Interest rate risk, as the prevailing interest rate is the most
significant input into the fair value of the instrument.
5. INTEREST IN SAMPLE PSAB JOINT VENTURE
On April 1, 2010, the College entered into a Memorandum of Understanding with the University of
Sample, known as the Sample PSAB Culinary Joint Venture. The purpose of the Joint Venture is to
provide the College and the University the opportunity to train students in hands-on culinary arts. The
Joint Venture operates a restaurant with the space and employees being shared between the College
and the University.
The following is the Colleges 50% share of the components of the financial statements of the Joint
Venture:
Page 15 of 35
SAMPLE PSAB COLLEGE
5. INTEREST IN SAMPLE PSAB JOINT VENTURE (continued)

2013 2012
Total assets $ 5,250,000 $ 5,150,000
Total liabilities 2,750,000 2,800,000
Net assets $ 2,500,000 $ 2,350,000
Revenue $ 1,100,000 $ 1,075,000

Expenses 950,000 950,000
Excess of revenue over expenses
for the year $ 150,000 $ 125,000
Cash provided by operating activities $ 250,000 $ 295,000

Cash used in investing activities (75,000) (115,000)
Cash used in financing activities (25,000) (35,000)
Net cash flows $ 150,000 $ 145,000
The Joint Venture is a not-for-profit organization, and as such follows the recommendations of CICA
Handbook Part III Accounting Standards for Not-for-Profit Organizations. As such, there are differences
between the accounting policies of the College under PSAB for Government NPOs and the Joint Venture
under Part III of the CICA Handbook. Under the modified equity approach, the College makes no
adjustment to the amounts disclosed or recognized in its financial statements for these differences. These
differences include:
(a) The employees of the joint venture are entitled to sick leave that accumulates, but does not
vest. Under Part III of the CICA Handbook, no liability is recognized for non-vesting leave and as
such, no such liability or expense has been provided for.
Page 16 of 35
SAMPLE PSAB COLLEGE
6. LONG TERM RECEIVABLE
The College has financed the building of the New Campus Student Centre on behalf of the Sample
PSAB College Student Association Inc. (SPCSAI). This receivable bears interest at prime minus 25
bps. This receivable is to be repaid through the collection of an annual student centre-building levy,
which is collected from all full-time and part-time students and bears interest at 3% per annum.
The College has also agreed to finance the building of the Health Centre on behalf of the SPCSAI. This
building is currently under construction, and has a forecasted cost of $24.2 million. The total cost
will be repaid through the collection of an annual levy, which is collected from all full-time and part-
time students.
2013 2012
Note receivable - Student Centre $ 2,000,000 $ 2,500,000

Note receivable - Health Centre 8,200,000 8,700,000
Less current portion estimate included in
accounts receivable (3,900,000) (3,900,000)
$ 6,300,000 $ 7,300,000
7. CONSTRUCTION IN PROGRESS
Construction in progress represents costs incurred to date on the construction of a new library and
academic facility, of which approximately $45.1 million has been spent to date, and a new Health
Centre, of which approximately $16 million has been spent to date. Once the construction has been
completed, the total cost will be reclassified to capital assets and amortization will commence. As at
March 31, 2013, construction in progress amounted to $61,100,000 (2012 - $60,500,000).
Page 17 of 35
SAMPLE PSAB COLLEGE
8. CAPITAL ASSETS
2013
Accumulated Net Book
Cost Amortization Value
Land $ 5,000,000 $ - $ 5,000,000

Buildings & improvements 177,550,000 63,750,000 113,800,000
Building - Student
Residence 13,900,000 3,190,000 10,710,000
Leasehold improvements 250,000 150,000 100,000
Site improvements 500,000 75,000 425,000
Furniture, equipment
and computers 115,463,500 105,000,000 10,463,500
Computer software 17,000,000 10,100,000 6,900,000
Large machinery 15,000,000 2,000,000 13,000,000
$ 344,663,500 $ 184,265,000 $ 160,398,500
2012
Accumulated Net Book
Cost Amortization Value
Land $ 5,000,000 $ - $ 5,000,000

Buildings & improvements 176,550,000 64,430,000 112,120,000
Building - Student
Residence 13,500,000 3,500,000 10,000,000
Leasehold improvements 250,000 100,000 150,000
Site improvements 500,000 100,000 400,000
Furniture, equipment
and computers 113,000,000 103,800,000 9,200,000
Computer software 13,500,000 9,500,000 4,000,000
Large machinery 14,500,000 2,500,000 12,000,000
$ 336,800,000 $ 183,930,000 $ 152,870,000
Amortization expense for the year is $13,200,000 (2012 - $12,600,000).
Page 18 of 35
SAMPLE PSAB COLLEGE
9. DEFERRED REVENUE
2013 2012
Advanced tuition fees 30,835,000 29,900,000
Other 3,011,750 2,335,000
$ 33,846,750 $ 32,235,000
10. BANK LOANS
The College has a $7,000,000 operating line of credit during the months of October through April and
a $12,000,000 operating line of credit during the months of May through September. No amount has
been drawn upon this operating line of credit as at March 31, 2013. The College has $2,100,000 (2012
- $1,900,000) in letters of credit outstanding as of March 31, 2013. In addition, the College has an
unused demand instalment loan facility of $2,145,000. The bank loan outstanding at year-end is as
follows:
2013 2012
Demand loan bearing interest at prime minus 25bps, repayable in

monthly instalments of $16,667 excluding interest through 2027.
This loan is secured by a general security agreement on all assets
of the Student Association $ 2,600,000 $ 2,800,000
The scheduled principal amounts payable within the next five years and thereafter are as follows:
2014 $ 200,000
2015 200,000
2016 200,000
2017 200,000
2018 200,000
Thereafter 1,600,000
Total $ 2,600,000
Page 19 of 35
SAMPLE PSAB COLLEGE
11. LENDING FACILITIES
The College has partially financed the building of the Student Residence through an unsecured non-
revolving bank loan, repayable in monthly installments of $90,900 principal and interest at the rate
of prime plus 3%. The bank loan is due on demand and has therefore been classified as current. The
College has fixed its interest rate at 6.82% through an interest rate swap for the term of the loan.
The interest rate includes a credit spread of 0.35%. The interest rate swap is a derivative financial
instrument. It has effectively locked in a fixed rate through 2026.
The fair value of the interest rate swap (in favour of the bank) of $1,900,000 (2012 -
$2,100,000) is recorded in the statement of financial position with the fluctuations being recorded in
the statement of remeasurement gains and losses.
The scheduled principal amounts payable within the next five years and thereafter are as follows:
2014 $ 415,564
2015 443,262
2016 472,807
2017 504,321
2018 537,936
Thereafter 15,926,110
Total $ 18,300,000
12. POST-EMPLOYMENT BENEFITS AND COMPENSATED ABSENCES LIABILITY
The following tables outline the components of the Colleges post-employment benefits and
compensated absences liabilities and the related expenses.
2013
Post-employment Non-vesting sick Vesting sick

Benefits leave leave Total liability
Accrued employee future
benefits obligations $ 2,155,400 $ 4,485,300 $ 559,300 $ 7,200,000
Value of plan assets (150,000) - - (150,000)
Unamortized actuarial
losses (245,000) (200,000) (197,500) (642,500)
Total liability $ 1,760,400 $ 4,285,300 $ 361,800 $ 6,407,500
Page 20 of 35
SAMPLE PSAB COLLEGE
12. POST-EMPLOYMENT BENEFITS AND COMPENSATED ABSENCES LIABILITY (continued)
2012

Benefits leave leave Total liability
Accrued employee future
benefits obligations $ 1,673,000 $ 3,480,000 $ 1,290,000 $ 6,443,000
Unamortized actuarial
losses (233,000) (180,000) (190,000) (603,000)
Total liability $ 1,440,000 $ 3,300,000 $ 1,100,000 $ 5,840,000
2013

Benefits leave leave Total expense
Current year
benefit cost $ 235,000 $ 800,000 $ 100,000 $ 1,135,000
Interest on accrued
benefit obligation 64,000 168,000 50,000 282,000
Amortized actuarial
losses 21,400 17,300 16,800 55,500
Total expense $ 320,400 $ 985,300 $ 166,800 $ 1,472,500
2012
Post-employment Non-vesting sick
Benefits leave Vesting sick leave Total expense
Current year
benefit cost $ 230,000 $ 790,000 $ 92,500 $ 1,112,500
Interest on accrued
benefit obligation 66,900 139,200 51,600 257,700
Amortized actuarial
losses 20,000 16,500 15,400 51,900
Total expense $ 316,900 $ 945,700 $ 159,500 $ 1,422,100
Page 21 of 35
SAMPLE PSAB COLLEGE
Above amounts exclude pension contributions to the Colleges of Applied Arts and Technology pension
plan, a multi-employer plan, described below.
Retirement Benefits
CAAT Pension Plan
A majority of the College's employees are participants in the defined benefit contributory retirement
pension plan of the Colleges of Applied Arts and Technology. The plan is a mutli-employer plan and
therefore the Colleges contributions are accounted for as if the plan were a defined contribution
plan with the Colleges contributions being expensed in the period they come due. Any unfunded
liability is to be paid directly by the Ministry of Training, Colleges and Universities. Contributions by
the College on account of current service pension costs amounted to $8,250,000 (2012 - $7,125,000)
and contributions by employees amounted to $7,650,000 (2011 - $6,800,000). The most recent
actuarial valuation filed with pension regulators as at January 1, 2012 indicated an actuarial surplus
of $150 million.
Post-Employment Benefits
The College extends post employment life insurance, health and dental benefits to certain employee
groups subsequent to their retirement. The College recognizes these benefits as they are earned
during the employees tenure of service. The related benefit liability was determined by an actuarial
valuation study commissioned by the College Employer Council.
The major actuarial assumptions employed for the valuations are as follows:
a) Discount rate
The present value as at March 31, 2013 of the future benefits was determined using a discount
rate of 4% (2012 4%).
b) Drug Costs
Drug costs were assumed to increase at a 10.5% rate for 2013 (2012 10%) and decrease
proportionately thereafter to an ultimate rate of 4.5% in 2026 for fiscal 2013 (2012 4.25%).
c) Hospital and other medical
Hospital and other medical costs were assumed to increase at 4.5% per annum (2012 4.5%).
Medical premium increases were assumed to increase at 8.0% per annum in 2013 (2012 7.75%)
and decrease proportionately thereafter to an ultimate rate of 4.5% in 2026 for the fiscal 2013
(2012 4.25%).
d) Dental costs
Dental costs were assumed to increase at 7.5% per annum in 2013 (7.25%) and decrease
proportionately thereafter to an ultimate rate of 4.5% in 2023 for the fiscal 2013 benefits cost
(2012 4.25%).
Dental costs were assumed to increase at 4.5% per annum for fiscal 2013.
Page 22 of 35
SAMPLE PSAB COLLEGE
Compensated Absences
Vesting Sick Leave
The College has provided for vesting sick leave benefits during the year. Eligible employees, after 10
years of service, are entitled to receive 50% of their accumulated sick leave credit on termination or
retirement to a maximum of 6 months salary. The program to accumulate sick leave credits ceased
for employees hired after March 31, 1991. The related benefit liability was determined by an
actuarial valuation study commissioned by the College Employer Council.
Non-Vesting Sick Leave
The College allocates to certain employee groups a specified number of days each year for use as
paid absences in the event of illness or injury. These days do not vest and are available immediately.
Employees are permitted to accumulate their unused allocation each year, up to the allowable
maximum provided in their employment agreements. Accumulated days may be used in future years
to the extent that the employees illness or injury exceeds the current years allocation of days. Sick
days are paid out at the salary in effect at the time of usage. The related benefit liability was
determined by an actuarial valuation study commissioned by the College Employer Council.
The assumptions used in the valuation of vesting and non-vesting sick leave are the Colleges best
estimates of expected rates of:
2013 2012
Wage and salary escalation 1.75% 1.50%

Discount rate 4.00% 4.00%
The probability that the employee will use more sick days than the annual accrual and the excess
number of sick days used are within ranges of 0% to 39.2% and 0 to 19.3 days respectively for age
groups ranging from 20 and under to 65 and over in bands of 5 years.
13. DEFERRED CONTRIBUTIONS
Deferred contributions represent unspent externally restricted funding that has been received and
relates to a subsequent year. Changes in the contributions deferred to future periods are as follows:
2013 2012
Balance, beginning of year $ 2,000,000 $ 1,900,000

Less amounts recognized as revenue in the year (1,650,000) (1,700,000)
Add amounts received during the year 1,750,000 1,800,000
Balance, end of year $ 2,100,000 $ 2,000,000
Page 23 of 35
SAMPLE PSAB COLLEGE
13. DEFERRED CONTRIBUTIONS (continued)
Deferred contributions are comprised of:

2013 2012
Scholarships and bursaries $ 1,600,000 $ 1,550,000

Endowment interest funds 100,000 125,000
Joint employment stability reserve 400,000 325,000
$ 2,100,000 $ 2,000,000
14. DEFERRED CAPITAL CONTRIBUTIONS
Deferred capital contributions represent the unamortized amount and unspent amount of donations
and grants received for the purchase of capital assets. The amortization of capital contributions is
recorded as revenue in the statement of operations. The changes in the deferred capital
contributions balances are as follows:
2013 2012

Less amortization of deferred capital contributions (5,600,000) (5,300,000)
Add transfers for construction in progress 1,100,000 2,000,000
Add contributions received for capital purposes 4,000,000 2,500,000
As at March 31, 2013 there were $1,000,000 (2012 - $1,500,000) of deferred capital contributions
received which were not spent.
15. DEFERRED CAPITAL CONTRIBUTIONS RELATING TO CONSTRUCTION IN PROGRESS
Deferred capital contributions relating to construction in progress represents the amount of grants
and other restricted funding received for the Library and the Athletic and Wellness Centre
construction projects in progress.
2013 2012

Less amounts transferred to assets in the year (1,100,000) (2,000,000)
Add contributions received for capital purposes 600,000 1,800,000
Page 24 of 35
SAMPLE PSAB COLLEGE
16. INVESTMENT IN CAPITAL ASSETS
A. Investment in capital assets represents the following:
2013 2012
Capital assets $ 160,398,500 $ 152,870,000

Construction in progress 61,100,000 60,500,000
221,498,500 213,370,000
Less amounts financed by:

Accounts payable 15,112,250 8,945,000
Term debt (Note 12) 18,300,000 18,700,000
Deferred capital contributions (Note 15) 72,500,000 72,500,000
Deferred capital contributions - construction (Note 16) 55,500,000 56,000,000
B. Change in net assets invested in capital assets is calculated as follows:
2013 2012
Deficiency of revenues over expenditures:

Amortization of deferred capital contributions
related to capital assets $ 5,600,000 $ 5,300,000
Amortization of capital assets (13,200,000) (12,600,000)
(7,600,000) (7,300,000)
Net change in investment in capital assets:

Purchase of capital assets
and transfers from construction in progress 21,328,500 22,270,000
Amounts funded by deferred capital contributions (5,100,000) (3,800,000)
Amounts funded by accounts payable (6,167,250) (8,945,000)
Repayment of term debt 400,000 500,000
10,461,250 10,025,000
17. INTERNALLY RESTRICTED NET ASSETS
Internally restricted net assets represents money set aside by College senior management for an
international student endowment fund. A commitment has been made by College senior
management to contribute 1% of international education tuition fees to this endowment fund. As at
March 31, 2013, internally restricted endowments were $855,000 (2012 - $825,000).
Page 25 of 35
SAMPLE PSAB COLLEGE
18. EXTERNALLY RESTRICTED NET ASSETS
Externally restricted net assets include restricted donations received by the College where the
endowment principal is required to be maintained intact. The investment income generated from
these endowments must be used in accordance with the various purposes established by donors. The
College ensures, as part of its fiduciary responsibilities, that all funds received with a restricted
purpose are expended for the purpose for which they were provided.
Investment income on externally restricted endowments that was disbursed during the year has been
recorded in the statement of operations since this income is available for disbursement as
scholarships and bursaries and the donors conditions have been met. The unspent portion of
investment income is recorded in deferred contributions. Investment income on endowed assets
recognized and deferred was $125,000 and $75,000 respectively (2011 - $130,000 and $65,000).
Externally restricted endowment funds include grants provided by the Government of Ontario from
the Ontario Student Opportunity Trust Fund. Under this program, the government matches funds
raised by the College. The purpose of the program is to assist academically qualified individuals who,
for financial reasons, would not otherwise be able to attend College.
19. COMMITMENTS
The College is committed to estimated minimum annual payments under operating lease agreements
over the next two years as follows:
Equipment and
services
2014 $ 1,600,000
2015 1,200,000
App. #6
20. FINANCIAL INSTRUMENT RISK MANAGEMENT
Credit risk
Credit risk is the risk of financial loss to the College if a debtor fails to make payments of interest
and principal when due. The College is exposed to this risk relating to its cash, debt holdings in its
investment portfolio, long-term receivable and accounts receivable. The College holds its cash
accounts with federally regulated chartered banks who are insured by the Canadian Deposit Insurance
Corporation. In the event of default, the Colleges cash accounts are insured up $300,000 (2012 -
$300,000).
The Colleges investment policy operates within the constraints of the investment guidelines issued
by the MTCU and puts limits on the bond portfolio including portfolio composition limits, issuer type
limits, bond quality limits, aggregate issuer limits, corporate sector limits and general guidelines for
geographic exposure. All fixed income portfolios are measured for performance on a quarterly basis
and monitored by management on a monthly basis. The guidelines permit the Colleges funds to be
invested in bonds issued by the Government of Canada, a Canadian province or a Canadian
municipality having a rating of A or better, or corporate investments having a rating of A (R-1) or
better.
The maximum exposure to investment credit risk is outlined in Note 4.
Page 26 of 35
SAMPLE PSAB COLLEGE
20. FINANCIAL INSTRUMENT RISK MANAGEMENT (continued)
Credit risk (continued)
Accounts receivable and long-term receivable are ultimately due from students. Credit risk is
mitigated by financial approval processes before a student is enrolled and the highly diversified
nature of the student population.
The College measures its exposure to credit risk based on how long the amounts have been
outstanding. An impairment allowance is set up based on the Colleges historical experience
regarding collections. The amounts outstanding at year end were as follows:
Past Due
Total Current 1 - 30 days 31 - 60 days 61 - 90 days 91 - 120 days
Government receivables $ 850,000 $ 850,000 $ - $ - $ - $ -
Student receivables 15,587,500 13,450,000 250,000 100,000 537,500 1,250,000
Other receivables 1,100,000 1,000,000 - - - 100,000
Gross receivables 17,537,500 15,300,000 250,000 100,000 537,500 1,350,000
Less: impairment allowances (1,000,000) - - - - (1,000,000)
Net receivables $ 16,537,500 $ 15,300,000 $ 250,000 $ 100,000 $ 537,500 $ 350,000
The amount of other receivables aged greater than 90 days relates to reimbursements of expenses
from an on campus vendor that the College will receive upon completion of renovations to existing
retail space. The amount is 110 days past due as there were delays in the project. As there are no
indications that the College will not be able to recover the balance, an impairment allowance has not
been recognized. Student receivables not impaired are collectible based on the Colleges assessment
and past experience regarding collection rates.
There have been no significant changes from the previous year in the exposure to risk or policies,
procedures and methods used to measure the risk App. #6.
Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
as a result of market factors. Market factors include three types of risk: currency risk, interest rate
risk and equity risk.
The Colleges investment policy operates within the constraints of the investment guidelines issued
by the MTCU. The policys application is monitored by management, the investment managers and
the board of governors. Diversification techniques are utilized to minimize risk. The Policy limits the
investment in any one corporate issuer to a maximum of 10% of the Colleges total fixed income
bonds.
procedures and methods used to measure the risk.
Currency risk
Currency risk relates to the College operating in different currencies and converting non-Canadian
earnings at different points in time at different foreign College levels when adverse changes in
foreign currency College rates occur. The College does not have any material transactions or financial
instruments denominated in foreign currencies.
Page 27 of 35
SAMPLE PSAB COLLEGE
Currency risk (continued)
App. #6
Interest rate risk
Interest rate risk is the potential for financial loss caused by fluctuations in fair value or future cash
flows of financial instruments because of changes in market interest rates.
The College is exposed to this risk through its interest bearing investments, bank loans and term
debt.
The College mitigates interest rate risk on its term debt through a derivative financial instrument
that exchanges the variable rate inherent in the term debt for a fixed rate (see Note 11). Therefore,
fluctuations in market interest rates would not impact future cash flows and operations relating to
the term debt.
The Colleges bond portfolio has interest rates ranging from 0.5% to 3.5% with maturities ranging
from April 5, 2015 to June 30, 2024.
At March 31, 2013, a 1% App. #6 fluctuation in interest rates, with all other variables held constant,
would have an estimated impact on the fair value of bonds and the interest rate swap of $850,000
and $225,000 respectively. A 1% fluctuation in interest rates would have an estimated impact on
interest expense related to the Colleges bank loans of $27,000 and a $68,000 impact on interest
income related to the Colleges long-term receivable. The Colleges term debt as described in Note
11 would not be impacted as the inherent variable rate of the debt has been fixed with the use of the
aforementioned derivative interest rate swap.
Equity risk
Equity risk is the uncertainty associated with the valuation of assets arising from changes in equity
markets. The College is exposed to this risk through its equity holdings within its investment
portfolio. At March 31, 2013, a 10% movement in the stock markets with all other variables held
constant would have an estimated effect on the fair values of the Colleges equities of $430,000.
Page 28 of 35
SAMPLE PSAB COLLEGE
Liquidity risk App. #6
Liquidity risk is the risk that the College will not be able to meet all cash outflow obligations as they
come due. The College mitigates this risk by monitoring cash activities and expected outflows
through extensive budgeting and maintaining investments that may be converted to cash in the near-
term if unexpected cash outflows arise. The follow table sets out the contractual maturities
(representing undiscounted contractual cash-flows of financial liabilities):
2013
Within 6 months to
6 months 1 year 1 - 5 years > 5 years
Accounts payable $ 37,485,000 $ - $ - $ -
Bank loans 100,002 100,002 800,016 1,599,980
Term debt 545,400 545,400 4,363,200 12,846,000
$ 38,130,402 $ 645,402 $ 5,163,216 $ 14,445,980
Derivative financial liabilities mature as described in Note 11.
Page 29 of 35
SAMPLE PSAB COLLEGE
Appendices to Financial Statements
NOTE: These appendices are for explanatory purposes and do not form part of the overall financial
statements under PSAB. Colleges are not required to present explanatory appendices.
Appendices Topic #1 Accounting for Controlled Enterprises, Joint Ventures and Significantly Influenced Entities
under PSAB for Government NPOs
PS 4250 Reporting Controlled and Related Entities by Not-for-Profit Organizations provides guidance on how
colleges should account for controlled and significantly influenced enterprises as well as joint ventures. For each
type of relationship, PS 4250 provides the following guidance:
For controlled enterprises:

Consolidation; or
Extensive disclosure of enterprise
For controlled profit-oriented enterprises:

Consolidation; or
Modified equity method
For significantly influenced enterprises:

Disclosure of the relationship with no recognition of economic interest in the colleges financial
statements
For Joint Ventures:

Proportionate consolidation; or
Modified equity method
The modified equity method accounts for the colleges interest in the enterprise by taking the colleges
investment in the enterprise and adding/subtracting the colleges share of income/loss each period, however
the enterprises accounting principles are not adjusted to conform to those of the college. For example, if the
enterprise follows International Financial Reporting Standards or accounting standards for not-for-profit
organizations, the basis of accounting is not adjusted in the allocation of income/loss to conform with PSAB for
Government NPOs. The significant differences in accounting policies should be disclosed (PS 4250.38(c)).
PS 4250 specifies that colleges may adopt different policies for reporting different enterprises. For example, a
college may consolidate one controlled enterprise and disclose another; however, PS 4250.18 states that similar
types of controlled organizations should be reported in the same manner.
Appendices Topic #2 Subsequent Disposition of Investments After Adoption of PS 3450
Per 3450.058, when a financial instrument in the fair value category is derecognized (Ie. Upon disposition), the
cumulative amount of remeasurement gains and losses previously reported is reversed out of accumulated
remeasurement gains/(losses) and recognized in the statement of operations. To more fully illustrate the
example in these financial statements, the following is a reconciliation of the amounts reported in the statement
of operations and accumulated remeasurement gains and losses for the year-ended March 31, 2013:
Amortized cost of bond immediately prior to PS 3450 adoption (03/31/12) $ 150,000

Fair value of bond upon adoption of PS 3450 and designation into fair value category 185,000
Amount included in accumulated remeasurement gains upon adoption of PS 3450 35,000
Fair value of bond at time of disposition (say 03/15/13) $ 192,500
Page 30 of 35
SAMPLE PSAB COLLEGE
Appendices Topic #2 Subsequent Disposition of Investments After Adoption of PS 3450 (continued)
Breakdown of entry required to recognize disposition of bond (assuming prior entries made to bring bond
to value of $185,000 upon adoption of PSAB):
Increase in Value
DR Bond value (in-year increase in value) 7,500
CR Accumulated remeasurement gains (in-year increase in value) 7,500
Disposition
DR Cash proceeds (fair value at time of sale) 192,500
DR Accumulated remeasurement gains (total gains) 42,500
CR Long-term investments (value before disposition) 192,500
CR Gain on disposal of investment (remainder) 42,500
Appendices Topic #3 Applying the Transitional Provisions of PS 3450 - Financial Instruments
PS 3450.099 states that the provisions of the section are applied as of the date of adoption (April 1, 2012 in the
case of the colleges adopting PSAB for Government NPOs) with no restatement of prior periods. Essentially, the
financial instruments (including investments) of colleges are accounted for under pre-changeover GAAP (sections
3855 and 3861) for the statements of financial position as at April 1, 2011 and March 31, 2012 and for the
statement of operations for the year-ended March 31, 2012. Financial instruments are categorized into pre-
changeover GAAP classifications (available for sale, held for trading, etc.) with the applicable recognition and
measurement standards. When a college applies the transitional provisions of 3450.099(b)(iii) in adjusting the
carrying value of financial instruments upon initial adoption, the adjustment is recognized in opening
accumulated remeasurement gains/(losses) at the beginning of the fiscal year in which 3450 is initially adopted
(April 1, 2012).
For financial instruments previously measured as available for sale and hedged instruments with fair value
fluctuations recognized directly in net assets (such as an interest rate swap in these example financial
statements), this component of net assets is adjusted to accumulated remeasurement gains/(losses) as of the
initial adoption of PS 3450 (April 1, 2012) as an adjustment to accumulated remeasurement gains/(losses).
For financial instruments previously measured as held for trading, no adjustment is made to accumulated
remeasurement gains/(losses) for the accumulated effect of fair value fluctuations in net assets prior to the
adoption of PS 3450. Subsequent to the adoption of the standard, further fluctuations in fair value from the
carrying amount ascribed to the instrument as of the date of adoption of PS 3450 (April 1, 2012) are recognized
in accumulated remeasurement gains/(losses).
The effects of adopting PS 3450, such as the introduction of the concept of the statement of remeasurement
gains and losses as well as the comprehensive guidance relating to the recognition, measurement, disclosure and
presentation of financial instruments is not an effect of adopting PSAB for Government NPOs initially as the
standard is not effective upon adoption of PSAB for Government NPOs initially on April 1, 2011. The effective
transition date for PS 3450 is April 1, 2012, therefore the effect of its provisions are a change in accounting
policy, not a change due to the adoption of a new accounting framework.
Page 31 of 35
SAMPLE PSAB COLLEGE
Appendices Topic #3 Applying the Transitional Provisions of PS 3450 - Financial Instruments (continued)
Note that the transitional provisions of PS 3450 allow for early adoption prior to the effective date of the
standard, April 1, 2012. However, colleges may not early adopt PS 3450 as the colleges date of transition to
PSAB for Government NPOs is April 1, 2012, the same date of the standard.
The effects of adopting PS 3450 Financial Instruments have been included in Note 3 Change in Accounting
Policy, not Note 2 First Time Adoption of Public Sector Accounting Standards.
Appendices Topic #4 Reconciliation of Adjustment to Expenses upon Adoption of PSAB for Government NPOs
This reconciliation has been provided to explain the adjustment to salaries and benefit expense for the year
ended March 31, 2012 upon adoption of PSAB for Government NPOs. As most Colleges presently disclose the
various components of retirement benefits and compensated absences separately, this table illustrates the
componentized effect of PSAB for Government NPOs adoption:
PSAB for
Pre-Changeover Government
GAAP NPOs Net Effect
Vesting sick leave
Balance as at April 1, 2011 $ 900,000 $ 1,200,000
Balance as at March 31, 2012 775,000 1,110,000
Difference $ (125,000) $ (90,000) 35,000
Non-vesting sick leave

Balance as at April 1, 2011 $ - $ 2,300,000
Balance as at March 31, 2012 - 3,300,000
Difference $ - $ 1,000,000 1,000,000
Post-employment benefits
Balance as at April 1, 2011 $ 1,300,000 $ 1,410,000
Balance as at March 31, 2012 1,325,000 1,440,000
Difference $ 25,000 $ 30,000 5,000
Net increase to expenses upon adoption of PSAB $ 1,040,000
Note that these example financial statements present the adjustments to the vesting sick leave, non-vesting sick
leave and post-employment benefits individually to ease the understanding of how PSAB for Government NPOs
affects colleges. As these liabilities are typically presented as a single line item on the statement of financial
position, this presentation is not a requirement.
Appendices Topic #5 Disclosure Requirements of PS 3450 and Financial Instrument Classification
PS 3450.070-071 requires Colleges to disclose financial instruments by classification category (fair value,
amortized cost, etc.). However, as PS 3450 is applied prospectively without the reclassification of financial
instruments for the comparative period of March 31, 2012, the same financial instrument categories do not exist,
as discussed in Appendices Topic #6. Therefore, the financial instrument categories available under pre-
changeover Canadian GAAP have been used to meet the disclosure requirements of the standard.
Page 32 of 35
SAMPLE PSAB COLLEGE
Appendices Topic #6 Financial Instrument Risk Management Disclosure
The risks, risk management policies and specific situations included in these financial statements for Note 20
Financial Instrument Risk Management are not comprehensive, and Colleges must carefully determine what risks
they are exposed to and the policies and factors that are utilized to mitigate them. This list of disclosures is not
exhaustive and Colleges may have significant risks relating to financial instruments not contemplated by these
example financial statements.
The investment policies and risk mitigations disclosed in Note 20 are based on situations, policies and procedures
a college may encounter or have in effect under reasonable circumstances, but is not intended to be interpreted
as an endorsement or recommendation of specific risk management policies or procedures for Colleges to follow.
Below is further explanatory discussion of the risk disclosures presented in these example financial statements.
Changes to Risk and Risk Management Policies
PS 3450.087(c) requires disclosure of any changes from the prior period in a Colleges exposure to financial
instrument risks and how they arise as well as its objectives, policies and processes for managing the risk and the
methods used to measure the risk. For example, this would include a change in a Colleges investment policy
such as changing the limits imposed on its investment portfolio from a maximum of 10% equities to 5%.
Credit risk
Each College must consider their own policies and procedures in evaluating the collectability of accounts
receivable. PS 3450.091 requires aging disclosure of:
(a) Financial assets that are past due at the financial statement date but not impaired. It is desirable to
include explanatory discussion as to why past due financial assets are not impaired.
(b) Financial assets that are individually determined to be impaired as at the financial statement date,
including the factors the College considered in determining they are impaired. This would include a
discussion of the Colleges policy in determining how student accounts are written off, as well as
discussion of other significant receivables impaired as at the financial statement date.
Additionally, the carrying value of financial instruments in these example financial statements approximates the
maximum exposure to credit risk. For example, the fair value of equities is the maximum amount that the
College may lose due to future impairment. Carrying value would not approximate the maximum exposure to
credit risk in situations such as financial instruments that have been discounted (Ie. A grant receivable to be
collected over 15 years) as the maximum exposure would be the undiscounted future contractual cash flows, not
the discounted value of the instrument recognized in the financial statements. If this were the case, the College
should disclose that there is a difference between the carrying value of financial instruments and their maximum
exposure to credit risk.
Interest rate risk
The example PSAB College utilizes a derivative to mitigate the risk relating to interest rate fluctuations on in its
term debt. For Colleges that do not utilize a derivative on financial liabilities with variable interest rates, a
sensitivity analysis should be disclosed showing the effect on operations and cash flows if a reasonable
fluctuation in interest rates had occurred in the current year (say 1%). In determining the factor to apply to
financial instruments at year-end relating to interest rate and other market sensitivity analysis, a College should
consider the economic environments in which it operates. A reasonably possible change does not involve remote
or worst case scenarios or stress tests.
Page 33 of 35
SAMPLE PSAB COLLEGE
Appendices Topic #6 Financial Instrument Risk Management Disclosure (continued)
Interest rate risk (continued)
Note that the items included in the maturity analyses as referenced in Note 20 equal the carrying value in the
financial statements. If a Colleges financial statements include long-term financial instruments that are carried
at a discounted value (Ie. A grant receivable to be collected over 15 years), the maturity analysis would differ in
that the contractual cash flows would be presented on a non-discounted basis.
Appendices Topic #7 Transitional Exemptions and Exceptions upon Adoption of PSAB for Government NPOs
The transitional exemptions included in the example financial statements include those that are most likely to
apply to the specific circumstances of the College sector. Each College must carefully assess which exemptions
apply to their specific circumstances. Below is a summary of the exemptions available under PS 2125 - First Time
Adoption by Government Organizations (see paragraphs .09-.14):
Retirement and Post-employment Benefits
PS 3250 requires entities to calculate relevant liabilities using prescribed methodologies that can differ
materially from pre-changeover Canadian GAAP. Preparing figures in compliance with these standards as at the
date of adoption of PSAB for Government NPOs requires an actuarial valuation. However, a first-time adopter
may elect to delay application of these provisions relative to the discount rate used until the date of their next
actuarial valuation or within three years of the transition date to PSAB for Government NPOs, whichever is
sooner. If a first-time adopter uses this election, it shall apply it to all plans. This exemption will likely not
impact the Colleges as actuarial valuations for post-employment and compensated absence benefits as at April 1,
2011 and March 31, 2012 have been requested by the College Employer Council on behalf of the Colleges of
Ontario.
Additionally, differences exist between pre-changeover Canadian GAAP and PSAB for Government NPOs in
relation to the treatment of actuarial gains/losses. Pre-changeover GAAP requires an accounting policy choice of
either recognizing actuarial gains/losses immediately or amortizing them into income using the corridor method.
PSAB for Government NPOs gives no accounting choice and requires actuarial gains/losses to be amortized into
income over the employee groups estimated average remaining service lives. To simplify the transition to PSAB
for Government NPOs and this difference, entities are permitted to recognize all cumulative actuarial gains and
losses as the date of transition to Public Sector Accounting Standards directly in accumulated surplus / deficit.
Actuarial gains and losses after the date of transition to PSAB for Government NPOs are to be accounted for in
accordance with Sections PS 3250 and PS 3255. If a first-time adopter uses this election, it shall apply it to all
plans. This exemption simplifies the adoption of PSAB for Government NPOs as Colleges would otherwise be
required to split the cumulative actuarial gains and losses from the inception of the plan until the date of
transition to PSAB for Government NPOs into a recognized portion and an unrecognized portion, which would be
onerous.
Business Combinations
PS 2510 - Additional Areas of Consolidation requires entities to apply the purchase method in accounting for
business combinations. These requirements can differ materially from pre-changeover Canadian GAAP, especially
for business combinations occurring before the Colleges adoption of 1582 Business Combinations. This
exemption allows entities to not apply the provisions of PS 2510 to business combinations occurring before the
date of adoption of PSAB for Government NPOs, with the exception of PS 2510.23 which requires purchases
premiums arising from the purchase of businesses to be recognized as an expense in the period of acquisition. If
an entity restates any business combination to comply with Section PS 2510, it restates all subsequent business
combinations from the date of the business combination.
Page 34 of 35
SAMPLE PSAB COLLEGE
Appendices Topic #7 Transitional Exemptions and Exceptions upon Adoption of PSAB for Government NPOs
(continued)
Investments in Government Business Enterprises and Business Partnerships
PS 3070 Investments in Government Business Enterprises requires investments in government business

enterprises to be accounted for using the modified equity method, wherein the proportionate share of income of
the business enterprise is recognized in the entitys financial statements by increasing/decreasing the
investment in the enterprise. No adjustment is made to the basis of accounting for the controlled entity (see
Appendices topic #1). Pre-changeover Canadian GAAP had differing standards depending on the nature of the
entity. For example, a joint venture could be accounted for using the proportionate consolidation method
instead of the equity method. This exemption allows the modified equity method in Section PS 3070 to be
applied on a prospective basis from the date of transition. The investment in a government business enterprise
balance reflected in the opening statement of financial position is based on the asset and liability balances
reflected in the government business enterprise financial statements on the date of transition as calculated
under pre-changeover Canadian GAAP. However, if a first-time adopter restates any investment in government
business enterprises to comply with Section PS 3070, it restates all subsequent investments in government
business enterprises from the date of the investment in a government business enterprise.
Tangible Capital Assets
PS 3150 Tangible Capital Assets has provisions relating to the impairment and write-down of tangible capital
assets that can differ materially from pre-changeover Canadian GAAP. This exemption allows entities to apply
these provisions prospectively from the date of adoption of PSAB for Government NPOs, rather than reassessing
all tangible capital assets initially recognized in the opening statement of financial position for write-down under
these provisions. Note that this exemption is not relevant to adopters of PSAB plus the 4200 series of standards
since these types of entities are transitioning from section 4430 Capital Assets Held by Not-for-Profit
Organizations to section PS 4230, which are virtually identical standards.
Appendices Topic #8 Miscellaneous Differences Between PSAB for Government NPOs and Pre-Changeover GAAP
Statement of Cash Flows
PS 1201 requires the statement of cash flow to contain an additional section - capital, whereas pre-changeover
GAAP only required operating, financing and investing. This section should contain cash disbursements relating
the acquisition of tangible capital assets and cash receipts for the intended purpose of acquiring tangible capital
assets. Gains/losses upon disposition of tangible capital assets remain as a non-cash adjusting item in the
operating section.
Acknowledgement of Responsibility for Financial Statement Preparation
PS 1201 requires an explicit statement either within the financial statements or accompanying them that the
college is responsible for the preparation of the financial statements. Some colleges and NPOs currently present
this in the form of a narrative that accompanies the financial statements indicating the roles and responsibilities
of the college in preparing the financial statements. This could also be included in the notes to the financial
statements.
Retrospective vs. Retroactive Application of Accounting Standards
Note that these illustrative financial statements use the term retroactive application as opposed to
retrospective as this is the terminology used within PSAB for Government NPOs.
Page 35 of 35
For more information, please contact:
AUDIT AND ASSURANCE
Burlington Mississauga North Bay
Bruce Nicholson Robert Wilkes Dean Decaire

905 633 4908 905 272 7823 705 495 2000
bnicholson@bdo.ca rwilkes@bdo.ca ddecaire@bdo.ca
Patricia Gonsalves Marcus Sconci

905 633 4920 905 272 7830
pgonsalves@bdo.ca msconci@bdo.ca
Marc Priestley
905 270 7700
mpriestley@bdo.ca
Sault Ste. Marie Sudbury Thunder Bay
Armand Capisciolto Alicia Croskery Walter Flasza

416 369 6937 705 671 3336 807 625 4410
acapisciolto@bdo.ca acroskery@bdo.ca wflasza@bdo.ca
Gabriel Stefanizzi Tony McGregor Ania Berezowski

705 945 0990 705 671 3336 807 625 4444
gstefanizzi@bdo.ca amcgregor@bdo.ca aberezowski@bdo.ca

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SAMPLE PSAB COLLEGE

ILLUSTRATIVE FINANCIAL STATEMENTS

Accounts payable and accrued liabilities $ 37,485,000 $ 35,700,000 $ 34,000,000

INVESTED IN CAPITAL ASSETS (Note 16) 60,086,250 57,225,000 54,500,000

ACCUMULATED REMEASUREMENT GAINS 415,000 - -

Grants and reimbursements $ 105,600,000 $ 100,600,000

Salaries and benefits 139,400,000 133,725,000

EXCESS OF REVENUE OVER EXPENSES FOR THE YEAR $ 23,192,500 $ 20,900,000

Unrestricted Capital Restricted

BALANCE, BEGINNING OF YEAR $ 4,540,000 $ 57,225,000 $ 825,000 $ 12,750,000 $ 75,340,000

EXCESS (DEFICIENCY) OF REVENUES

INVESTMENT IN CAPITAL ASSETS (10,461,250) 10,461,250 - - -

BALANCE, END OF YEAR $ 26,941,250 $ 60,086,250 $ 855,000 $ 12,865,000 $ 100,747,500

March 31, 2012

Unrestricted Capital Restricted

BALANCE, BEGINNING OF YEAR $ (13,910,000) $ 54,500,000 $ 800,000 $ 12,500,000 $ 53,890,000

EXCESS (DEFICIENCY) OF REVENUES

CHANGE IN FAIR VALUE OF

INVESTMENT IN CAPITAL ASSETS (10,025,000) 10,025,000 - - -

BALANCE, END OF YEAR $ 4,540,000 $ 57,225,000 $ 825,000 $ 12,750,000 $ 75,340,000

NET INFLOW (OUTFLOW) OF CASH RELATED

Accrual for post-employment benefits and compensated absences 567,500 930,000

Changes in non-cash working capital items:

CASH, BEGINNING OF YEAR 15,140,000 1,575,000

March 31, 2013 March 31, 2012

Accumulated remeasurement losses at beginning of year $ - $ -

Accumulated remeasurement gains at end of year $ 415,000 $ -

(a) The adjustment to opening accumulated remeasurement gains/(losses) relates to:

Increase due to classifying bond portfolio in the FV category 2,000,000

1. SIGNIFICANT ACCOUNTING POLICIES

Description of Sample PSAB College, established in 1967, is an Ontario college of

The College is a not-for-profit organization and, as such, is

Ancillary revenues including parking, bookstore, residence and

Unrestricted contributions are recognized as revenue when

Externally restricted contributions and restricted investment

Restricted contributions for the purchase of capital assets are

Endowment contributions are recognized as direct increases in

Restricted investment income is recognized as revenue in the year

1. SIGNIFICANT ACCOUNTING POLICIES (continued)

Construction in progress is not recorded as a capital asset, or

Capital assets are capitalized on acquisition and amortized on a

Buildings & building improvements - 20 to 40 years

Retirement and The College provides defined retirement and post-employment

(i) The costs of post-employment future benefits are

(ii) The costs of the multi-employer defined benefit pension

1. SIGNIFICANT ACCOUNTING POLICIES (continued)

(iv) The discount used in the determination of the above-

They are initially recognized at cost and subsequently carried at

Transaction costs related to financial instruments in the fair value

Where a decline in fair value is determined to be other than

1. SIGNIFICANT ACCOUNTING POLICIES (continued)

Transaction costs related to financial instruments in the

Writedowns on financial assets in the amortized cost category are

Management The preparation of financial statements in conformity with PSAB

2. FIRST TIME ADOPTION OF PUBLIC SECTOR ACCOUNTING STANDARDS

2. FIRST TIME ADOPTION OF PUBLIC SECTOR ACCOUNTING STANDARDS (continued)

Reconciliation of net assets and excess of revenue over expenses

2. FIRST TIME ADOPTION OF PUBLIC SECTOR ACCOUNTING STANDARDS (continued)

Statement of Financial Position as at April 1, 2011 Transition Date

Statement of Financial Position for the year-ended March 31, 2012

2. FIRST TIME ADOPTION OF PUBLIC SECTOR ACCOUNTING STANDARDS (continued)

Statement of Operations for the year-ended March 31, 2012

Excess of revenue over

Statement of Cash Flows for the year-ended March 31, 2012