2018 Annual Financial Report

NOTESTOTHE CONSOLIDATED CITY OF SURREY FINANCIAL STATEMENTS

For the year ended December 31, 2018 [tabular amounts in thousands of dollars]

1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) n) Investments

City investments with an original maturity date of more than three months are reported as investments and consist of demand deposits, short-term investments, bonds and debentures, which are recorded at amortized cost. Discounts and premiums arising on the purchase of these investments are amortized over the term of the investments on a straight-line basis. o) Non-financial assets Non-financial assets are not available to discharge existing liabilities and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the ordinary course of operations. i) Tangible capital assets Tangible capital assets are recorded at cost, which includes amounts that are directly related to the acquisition, design, construction, development, improvement or betterment of the assets. Cost includes overhead charges related to construction and development that are directly attributable to the acquisition or construction of the asset.

The cost, less residual value, of the tangible capital assets, excluding land, are amortized on a straight-line basis over their estimated useful lives as follows:

ASSET

USEFUL LIFE – YEARS

Land improvements

12 – 100 10 – 60 2 – 25 5 – 100 10 – 100 4 – 50

Buildings and building improvements

Leasehold improvements Infrastructure Roads and road structures

Water, Sewer and Drainage systems

Machinery and equipment

Annual amortization is charged commencing on the date the asset is acquired or available for use. Assets under construction are not amortized until the asset is available for productive use. ii) Contributions of tangible capital assets Tangible capital assets received as contributions are recorded at their fair value at the date of receipt and are recorded as revenue. iii) Intangible assets Intangible assets, including works of art and historic assets are not recorded as assets in these financial statements. iv) Tangible capital assets disclosed at nominal values Where an estimate of fair value is not determinable, the tangible capital asset is recognized at a nominal value. v) Write-down of tangible capital assets Tangible capital assets are written down when conditions indicate that they no longer contribute to the City’s ability to provide goods and services. Any impairment is accounted for as an expense in the consolidated statement of operations. vi) Leases Leases that transfer substantially all the benefits and risks incidental to ownership of the property are accounted for as capital leases and the related tangible capital asset and obligation are recorded on the statement of financial position. All other leases are accounted for as operating leases and the related lease payments are expensed as incurred.

53

Made with FlippingBook flipbook maker