Sixteen Mile Sports Complex | Officially opened ... - Oakville

Notes to Consolidated Financial StatementsYear ended December 31, 2010(tabular columns in thousands of dollars)(G) Cash equivalents:Cash equivalents include short-term highly liquid investmentswith a term to maturity of 90 days or less at acquisition.(H) Investments:Investments consist of bonds and debentures and are recordedat amortized cost. Discounts and premiums arising on thepurchase of these investments are amortized over the termof the investments. When there has been a loss in value thatis other than a temporary decline in value, the respectiveinvestment is written down to recognize the loss.(I) Net investment in direct financing leases receivable:Investment income related to the municipality’s net investmentin direct financing leases is recognized in a manner that producesa constant rate of return on investment. The investment in theleases is composed of net minimum remaining lease paymentsnet of unearned investment income.(J) Employee future benefits:(i) The town provides certain employee benefits which willrequire funding in future periods. These benefits includelong-term disability, benefits under the Workplace Safetyand Insurance Board (“WSIB”) Act, and extended health anddental benefits for early retirees.The costs of long-term disability, benefits under the WorkplaceSafety and Insurance Board Act and extended health anddental benefits are actuarially determined using management’sbest estimate of salary escalation, earned days accumulatedfor certain employees payable at retirement, health care costtrends, long term inflation rates and discount rates.For self-insured retirement and other employee future benefitsthat vest or accumulate over the periods of service providedby employees, such as service payments, health and dentalbenefits for retirees, the cost is actuarially determined usingthe projected benefits method prorated on service. Under thismethod, the benefit costs are recognized over the expectedaverage service life of the employee group. Any actuarialgains and losses related to the past service of employees areamortized over the expected average remaining service life ofthe employee group.For those self-insured benefit obligations that arise fromspecific events that occur from time to time, such asobligations for workers’ compensation and life insurance andhealth care benefits for those on disability leave, the cost isrecognized immediately in the period the events occur. Anyactuarial gains and losses that are related to these benefits arerecognized immediately in the period they arise.(ii) The costs of multi-employer defined contribution pensionplan benefits, such as the Ontario Municipal EmployeesRetirement System (“OMERS”) pensions, are the employer’scontributions due to the plan in the period.(K) Non-financial assets:Non-financial assets are not available to discharge existingliabilities and are held for use in the provision of services.They have useful lives extending beyond the current year andare not intended for sale in the ordinary course of operations.(i) Tangible capital assetsTangible capital assets are recorded at cost which includesamounts that are directly attributable to acquisition,construction, development or betterment of the asset. The cost,less residual value, of the tangible capital assets, excludingland and landfill sites, are amortized on a straight line basisover their estimated useful lives as follows:AssetYearsLand improvements 3 - 100Buildings 10 - 75Equipment 3 - 19Vehicles 3 - 18Roads network 10 - 100Environmental network 10 - 100Communications and technology network 3 - 8Annual amortization is charged in the year of acquisitionand in the year of disposal. Assets under construction are notamortized until the asset is available for productive use.(ii) Contributions of tangible capital assetsTangible capital assets received as contributions are recordedat their fair value at the date of receipt and also are recordedas revenue.(iii) Natural resourcesNatural resources that have not been purchased are notrecognized as assets in the financial statements.(iv) Works of art and cultural and historic assetsWorks of art and cultural and historic assets are not recordedas assets in these financial statements.(v) Interest capitalizationThe Town does not capitalize interest costs associated with theacquisition or construction of a tangible capital asset.Town of Oakville 2010 Annual Report | 28